You know Mario and Rabbids Sparks of Hope?
(Bear in mind, I have never played this game.) When Rosalina turns bad, she takes control of Bowser’s minions and all of mushroom kingdom. So it’s at this point, Bowser finally realizes: “If I can’t beat Mario, join Mario!” Is that correct? He realizes now it’s best to just fight for Peach and Mario instead of force Peach to marry him like in Super Mario Odyssey.
Ever since Super Mario Bros. 3 it’s confirmed that it’s all a stage play and repeated over and over again, so it’s not been a one-off. They play the same or similar roles in otherwise disconnected plays / movies.
Super Mario Bros 3: Curtain raises and the levels are just stage sets. https://www.youtube.com/watch?v=seZM0HHPIdo
Super Mario All-Stars: The gang hangs around at a party https://www.youtube.com/watch?v=tySdQ1l_hGM
Paper Mario: Same curtain thing going on as in SMB3 and at battles you can even see the audience https://www.youtube.com/watch?v=pmUtCTtFA4U
Doesn’t that only confirm that it’s a play in the games where the visuals explicitly show that it’s a play? Beyond that Mario games don’t seem to clearly be in any sort of fictional medium context at all, just because SMB3 was a play doesn’t automatically mean Super Mario Sunshine is also a play or a movie, at that point that’s just the characters’ lives.
I actually find it funny trying to make any sense of Mario mythos at all. The characters are endearing placeholders for protagonists and enemies and create an easy design language to use for a game, but there’s not really a consistent lore, the closest we’ve come to this whole sort of idea being legitimatized is how Nintendo has handled Zelda.
They could eventually try to create a Mario canon, but I think it’s a bit too silly of a franchise to try to seriously do that with, the characters and world just bend to fit whatever works best on a per-game basis, for tone and mechanical reasons more than anything else, whether that’s a play or ostensibly real characters in their regular lives.
Even Miyamoto shares this perspective. It’s not that every game is a play, but rather the characters themselves are actors and the games are the medium they’re in.
https://www.polygon.com/gaming/2012/9/25/3407672/miyamoto-the-mario-cast-is-a-troupe-of-actors-and-bowsers-kids-are