Except that now you actually posted it here twice

My friends and I have been playing the smash bros 3ds demo a lot. I bet they'd love to see this game. Should I show it to them as is or should I wait until it is complete?

They are not the same, notice the [Asm]/[Axe] part
One explains how to do it using SPASM or similar, for those having a z80 dev environment, and the other one explains how to do it with Axe, for those without a z80 dev environment.

Oh wait I missed that, my bad. Perhaps make ASM all-caps so it's more noticeable

Well, do as you please but don't forget that motivation is what keeps me working on things, so if they can give me motivation (like if they start spriting characters or do something else that proves they are interested in my game), this game will have more chances to be "finished"

Which is why a ticalc.org demo with some characters might be a good idea, especially now that SSB3DS just came out and that school just started. Imagine how many downloads it will get and the potential for extra feedback it would generate, even with no ticalc news.

Will you be taking a P:M style for everyone else so it's (more) balanced?

Obligatory question: Will you support GameCube controllers through the USB port?

(off topic)
How did you change the font in the screenshot on the first post?
(on topic)
Will SSBO ever support gCn? 'Cause that would be epic!

My only concern about custom characters is if this game ever becomes online via gCn or something, then people could just make super-high-mega-ultra-overpowered characters that are nearly invincible then win against anyone. Also, how would it work if someone tries to link play vs another player but the other player doesn't have all the maps and characters the opponent has? What about characters with duplicate file names (eg if someone has REUBEN.8xp on his calc for Reuben Quest character, but the other player has Reuben from Mystic Quest Legend and the other player link plays with Reuben). Wouldn't that mess the game up?

Players could manually get together before GCN play some other way, headers could be used to mark a player file, and depending upon how the data is translated (data or keypresses), hacking may just fail or be unavoidable. As long as you can just switch opponents, it should be fine.

Indeed, but the issue if it's possible to make overpowered characters is that in such case everybody would only play that character and nothing else so it would get boring. Maybe make it so that character's attributes are split in percentage form or among a fixed stat points pool like in Dying Eyes for the 83+ (you can allocate 200 points to stats of your choice, ranging from HP, MP, attack, defense, speed, etc). If percentage-based (eg attack 30% speed 10% defense 60%) then the game would recalculate it with normal values if needed but you would need to make sure also that people won't enter invalid numbers by either making the game reject such character so that people won't attempt to crash other people's calcs via link play