By no means do I hate Final Fantasy, but I must say that Mario and Final Fantasy do not belong together. Super Mario RPG was a spectacular display of how Square could pull off a Mario-ized Final Fantasy-esque game. The Fighter is Mario, the Black Mage is Mallow, the Red Mage is Geno, the Black Belt is Bowser (close, Bowser's special is Dukar), the White Mage is Toadstool, and no one likes Ninjas so the Thief is absent. All the spells are Mario-like, as are the enemies. Except Culex--sort of a style cameo, not a character one. He worked, as he spoke of being from another dimension and stuff.
Conclusion: Please, no agile 17-year-olds with big hair. Mario does not engage in swordplay. I don't know how a real SMRPG sequel would be, though. It wouldn't be the same without the original characters, who have been destroyed/made royalty/returned to the Star Road.
I don't think they'll follow through with it. If they do, I wonder what direction they'll take with the graphics... we've never had a Mario RPG with all 3-D characters.
* Bird Person is still hoping for a Mario & Luigi game on the Wii with a co-op mode playable at will