Lookin' good so far. It looks like it wont be to different from other smash bros fan titles, which isn't much of a problem, but it would be nice to see someone take smash bros and do something different with it.
In any case, there's another thing I'd like to add: I know the roster will have some standard faces, but it would be cool to see some other video game character in in on this, not just 3rd party characters like Megaman and sonic, but try some other characters: Battletoads, Megaman Zero or ZX, Guardian Heroes(I have usable sprites myself if you consider trying them), and some other sega characters other then sonic(Would be nice to see knuckles and Espio though), like Vectorman, Toejam & Earl, Joe Musashi from the shinobi games, Gunstar Heroes, or Alien Soldier. Your on a good start with bubblun though.
That's all I've got to say, hope your game turns out well.