Super Smash Bros. history is full of characters who almost made the final cut but didn’t. For example, Blastoise was part of the Super Smash Bros. Brawl‘s Pokémon Trainer trio before it was replaced with Squirtle for balancing purposes. Hideo Kojima begged Masahiro Sakurai to include Solid Snake in Super Smash Bros. Melee, but the game was too far along. So why was Krystal dropped? Was it a balancing issue or a time issue? According to Sakurai, the latter.
During an interview with Nintendo Dream (translation provided by Source Gaming), Sakurai revealed that Krystal was supposed to be in Super Smash Bros. Brawl, but the dev team didn’t have enough time to model her. Unlike the clone character Falco, the developers couldn’t just take Fox’s model, tweak it, and call it a day to create Krystal — she had to be built from the ground up. But the team still needed one more character to fill out the roster, so they picked a fighter who could be modeled on the fly and was popular to boot: Wolf O’Donnell.
Even though Wolf is widely derided as a clone character, that negative connotation is why he made it into Brawl. Sakurai estimated that creating Wolf took around 70% of the effort that Krystal would have required. Sometimes corners have to be cut in video game development.