I wouldn't mind making such characters eligible, as long as it remains a VG contest (or else votals would just be even s***tier than usual), but I feel that simply having a well-designed bracket is much more important for having a good contest than just throwing more characters in. Having more characters won't mean s*** if they're all thrown in matches so damn obvious that they're simply wasted.
Again, s*** like new characters, removing Link, or even just doing no gimmicks are meaningless if the bracket is a f***ing disaster.
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Current Let's Play: Final Fantasy IV (FF2US)
http://forums.somethingawful.com/showthread.php?threadid=3445328