WMG / Game & Watch

The Subspace Emissary is canon to the Game & Watch universe.
The Mr. Game & Watch race, and by extension likely everything in Superflat World, are made of the adaptable matter known as Shadow Bugs, which would explain how it has its own equivalent of Mario, Donkey Kong, Link, Popeye, Charlie Brown, and others — they're just like the fake brawlers in SSE.

Game And Watch Gallery Of Gore
Hi. I'm going to give you a new vision of Game And Watch and the death behind it. Let's begin with Ball, the first game. GAW is a circus clown who does juggling. Pretty basic, and then comes Flagman. Here's a pirate holding some flags to match them. Why? Well, because between the first two comes Helmet.. In this plotline, at least. So he gets a bump on the head and has to perform a memory test. After that, our still-frame hero gets involved with a fire incident and has to escape with the help of a stretcher. On his way home, he encounters a damaged bridge. Luckily, Manhole guy helps people across. Then, Manhole guy goes home from work to deal with a mole infestation, Vermin. After they have all gone, Manhole guy finds GAW again, and they get in a hammer fight, Judge. Manhole guy kills GAW, and then starts living in hiding. The circus replaces GAW with an ape trained by a carpenter [Donkey Kong Circus], which starts the Mario series. And that, my friends, is the murderous story of Game And Watch.

Every single character in the G&W series is Mr. Game and Watch.
According to the Subspace Emissary, Mr. Game & Watch is made of some odd substance that can be anything. This explains how he can spawn stuff like hammers, torches, flags, and bells in his moveset, as well as his transformation into Octopus. All those characters you play as and fight in Game and Watch is just Mr. Game & Watch in different forms. Mr. Game & Watch is the two firemen saving those people from the burning building, and Mr. Game & Watch is also those same people in need. Mr. Game & Watch imitates Mario in Mario's Cement Factory and Mario Bros. and the like. Everything is Mr. Game & Watch.
  • This means that Mr. Game & Watch is Mario, Luigi, Peach, Bowser, Donkey Kong, Link and Zelda. By the Transitive Property, this means that Mario is Luigi, Peach is Bowser and Link is Zelda etc.