Yes, I realize that, but at the same time, they don't seem to be upholding that rule strictly if Snake is anything to go by. Don't get me wrong. I'm not dying to see Cloud in the game. I think he'd make a nice addition but there are many other 3rd party characters I'd rather see and deserve a spot far more. Sora is very much a possibility however, Cloud is far more popular. Brawl won't have any trouble selling, but if I were Nintendo, I'd pick Cloud based on sales potential alone even if he's there by a technicality.
And I'll give you Sora, but not Geno and Mallow. They're too obscure and part of a series that is very well represented in Smash Bros. already. Maybe Assist Trophies, but not playable.