I'd argue Paper Mario is the only corner of this franchise to have actually undergone these restrictions to the fullest. Even during the supposed "sterile" spell of Mario games from 2011 to ~2013 (which tbh is an appropriate qualifier in comparison to what you see today), NSMB2, NSMBU, and Mario 3D Land still got new enemies and even at least one character (Nabbit). It's only Paper Mario that made a point to have Red Toads, Blue Toads, Yellow Toads, and Green Toads as NPCs during and after that period of time. I'd frame that as the developer taking to heart what Nintendo's IP supervisors were championing for the brand as a whole, or maybe even some weird creative self-flagellation that I don't personally understand.
True. Aside from core mainline, many other different feature games beside sport /party, like Peach's Showtime, Luigi's Mansion and Treasure Tracker were all able to pull out original contents. For unknown weird reason, previous RPGs seem to fail to devote to an original theme for an independent story and that's weird.
If all these games were made to be themes for RPG titles (e.g. Paper Peach's Shwotime), that can definitely be a hyping news.
(Some will bring up Paper Jam as an extension of these restrictions beyond the Paper Mario series, but its predecessor, Dream Team, a game with original characters and scenarios, was developed during the time Nintendo was supposedly reining in the Mario brand. Paper Jam was also followed by a bunch of Mario & Luigi remakes that were fairly faithful to the original material. I'd say that game is more of an exception.)
So far M&L strictly focuses on the brothers as well as the core Super Mario contents. There were original characters, but as M&L are the only core party team, you don't really get to scout more party members (even as assists). The original contents mostly only serve as side dishes or just give a reason for M&L to start a new adventure.
For storytelling part fans are already fed up enough with the brotherhood with the five M&L games,
also other games beside M&L (Super Paper Mario, Luigi's Mansion, the 2023 movie etc) they can all cover M&L's relationship and it's not exclusive to M&L. I'm very concerned that M&L hasn't really figured out how to do a story that is 100% exclusive to this subbrand or it has to retire for good.
I don't hate M&L, but if it returns one day it needs to add more diverse contents for the party. I really like the ideas of team fighting but you cannot expect gamers to ask for gameplay
only. Especially the fighting system could had been in a better use if more characters were allowed to participate.