Ever thought of making a nurbs (very easy, very low polygon technique but looks as good as a well as a well made polygon mesh) model with displacement mapping (to give depth and height) its in Maya and other popular 3d editing programs.
Displacement maps
http://img443.imageshack.us/img443/1960/displacementmap7txxs6.jpg
http://img474.imageshack.us/img474/7196/fullbrucekh0.th.jpg
or
Nurbs
http://img512.imageshack.us/img512/4687/nurbsbivariatemeshzl9.th.jpg
http://img444.imageshack.us/img444/9177/nurbsep5.th.jpg
Now you can render this on a LAN with several computers linked to together to combine(roughly?) your resources.
Both of these can be done on the Wii and GC(why aren’t they?)and they makes a low polygon model look ALOT better.
Now if you want to make spriting easier. Get the following…
1)Adobe Photoshop
2)a packet of skittles and Barq’s or A&W root beer(optional)
3)Macromedia Flash
4)patience
5)a person who can draw(spriter)
Now draw every angle to a fully extended(arms legs extended) body in 300 degrees. Then break them up into joints, and the connected parts(think action figure).Then find something like transparency maps to the joints so they can move without artifacts. Then make several sprites for the joints(300 degrees of extension/contraction).The Face can be Extremely hard and long winded (for a simulated high-end anime-like appearance) or just make a normal static face (easy).
you can apply depth-maps/bump maps to simulate depth/height.
Now the hit detection.Since this is 2d and not 3d this is going to be a lot easier.In macromedia flash make some circles(DO NOT MAKE THEM TOO BIG match the animation as accurately as possible) then you need a script to give behaviors to them.(priority rules-grabs,projectiles,supers,super grabs,invincibility,unblockable, trade, etc. ) Then some defensive ones (your body box).Then you need objects:Items like in ssbm,automatic character weapons like Vega’s claw, stage objects balcony,cars,barrels,arcade machines ,gates,destructible environments, the stage itself. With an object as the stage you can have a terrain to a stage.It can even change dynamically(move around have weather, fall apart, construct itself, have crowds, hazards(like pits,spikes and monsters) and controlled stage weapons(like a turret machine gun,ufo,tank or chandeleer) .You brain storm.