Like many other games, the Super Smash Brothers series has had various rumors spread about it, usually through the Internet, and sometimes magazines. Most of the time, these will be about playable characters, though occasionally, a different sort of rumor will pop up.
Sonic and TailsThis is most famous rumor about Melee. An April Fool's joke said that Sonic and Tails could be unlocked after defeating 20 enemies in Cruel Melee. This has been proven false by countless people.
However, Sonic has become a playable character in Brawl, and Tails shows up in cameos.
Toad in MeleeAnother infamous rumor featured Toad as a playable character in Melee. The Toad rumor stated that Toad could be unlocked as a playable character in Melee after obtaining a perfect score during the credits mini-game (played after completing Classic Mode, Adventure Mode or All-Star Mode). There are also several fake screenshots depicting Toad in various in-game scenarios, propagating the rumor. Since Toad is one of Peach's attacks, it was easily proven false.
Master Hand, Metal Mario, Raichu & Wigglytuff in The Original
Videos all over YouTube have claimed to unlock Master Hand in Super Smash Bros, via spinning the control stick 30 times on the select screen. The only way to play as Master Hand is through a cheat device, such as an Action Replay. The same goes for Metal Mario, only by spinning the control stick 4 times, or occasionally 10. Raichu and Wigglytuff are also said to be in the game, but rumors of their unlockabilty are few and far between.
Clouds of Bosses
A popular theory states that at the beginning of the Subspace Emissary when Meta Knight's ship appears, various faces show when the ghastly clouds form. People have speculated this to be four major bosses throughout the game. This seems to be coincidence at best, much like Rorschach inkblot tests. Many people believe the four "faces" resemble Ganondorf, Master Hand, Bowser, and Ridley. As it were, all four characters where villains during the game, two being bosses. Many believed the Ganondorf cloud could have also been Mewtwo, who is no longer a playable character in Brawl.
Ridley, Bowser Jr, and Wind Waker Link
At one point shortly after the game's announcement, a rumor began floating around that Ridley, Wind-Waker/Cel-Shaded Link (Toon Link), and Bowser, Jr. would be playable characters. There was also the rumor of Young Link, Ice Climbers, and Mr. Game and Watch being dropped. The alleged source was a radio interview with Masahiro Sakurai. This was proven to be mostly false, with the exception of Toon Link replacing Young Link. However, this appears to be mostly cosmetic, as Toon Link plays much like Young Link.
No More Clones
Another popular rumor stated that Sakurai claimed clones will not be in Brawl. That would mean Dr. Mario, Roy, Pichu, Ganondorf, Falco, Young Link, and (to a lesser extent) Luigi, would be removed or redesigned for Brawl. This has has been proven mostly true. The majority of clone type characters have been differentiated compared to the level of similarity in Melee, while others have been dropped entirely.
Brawl is the Last Game
Sakurai has said that several things along the lines of that he was making Brawl like it was the last game, or that this would be his last game. This has led several to believe that this is the last Smash game. However, Sakurai has also said that Melee would've been his last game, and that did not come true. It is also very likely that whether or not Sakurai will be working on another game, Nintendo will most likely continue the Smash series regardless, due to its success.
Sakurai said that, after Sonic and Snake, there might be a third party character. This lead many people to believe that it was certain that a third party would be in there. The two most popularly rumored characters were Mega Man, from his own self-titled series, and Geno, from Super Mario RPG. Some even believed that Geno was partially programmed into the game, but cut out due to Square-Enix not giving consent. The Mega Man rumor was disproved when the creator of Mega Man said that he would like to see Mega Man in Brawl, but Nintendo hadn't asked him or CAPCOM. It was also said that another CAPCOM character, Leon Kennedy, from Resident Evil, was in, due to his voice actor being listed on IMDB for a short time on the Super Smash Brothers Brawl page. However, this proved not to be the case, and that voice actor was either not performing for the game, or just voiced another character.
Leaked Brawl Image
Before Brawl came out, an image was found that resembled a character screen filled with many of the most-wanted characters. However, just like other hoaxes, some of the character icons were copies of art from previous games (which Smash Bros. has never done), and so was confirmed as false.