In the same VGC interview where Kensuke Tanabe said Nintendo wouldn't ignore casual players, the Paper Mario: The Origami King producer touched on the creative restrictions tied to the Paper Mario series - when asked about what it takes to design a new character (and villain, for that matter) to stand alongside the all-time greats like Bowser and Kamek.
Kensuke Tanabe: Since Paper Mario: Sticker Star, it’s no longer possible to modify Mario characters or to create original characters that touch on the Mario universe. That means that if we aren’t using Mario characters for bosses, we need to create original characters with designs that don’t involve the Mario universe at all, like we’ve done with Olly and the stationery bosses.
Whether a character becomes an all-time hit or not isn’t up to us on the development side; I think it’s more the case that characters that fans truly accept naturally end up that way. I hope that the origami siblings in Paper Mario: The Origami King will stay in players’ memories, even if they do only end up appearing in this title.
This suggests certain characters that modify existing ones are essentially off-limits and new ones created need to be original. There's no guarantee new characters will make more than one appearance, either.
Tanabe previously touched on these guidelines in an Iwata Asks interview about Paper Mario: Sticker Star - highlighting how Shigeru Miyamoto told him to complete this particular entry with Super Mario World characters, and noting how "strict" the rules were in regards to new characters (thanks, Nintendo Enthusiast):
Aside from wanting us to change the atmosphere a lot, there were two main things that Miyamoto-san said from the start of the project—"It's fine without a story, so do we really need one?" and "As much as possible, complete it with only characters from the Super Mario world.
But being unable to use new characters is pretty strict. Of course, we could not make any new enemy characters, and as for allies among the Super Mario characters, there's really only Toad in various colors!
So, there you go - consider this a reminder as to why the Paper Mario series is much more traditional nowadays. What do you think about this design decision? Leave a comment down below.