Zelda is back and this is a closer fight than it’s given credit for. Zelda has magical abilities that she can use to enhance her hand to hand skills. In pure hand to hand she’s nearly as good as Mario, and maybe even better (With Sheik form of course). Mario has more ha-power ups at his disposal. This helps him take the win. Mario wins.

Update! Mario may be a pretty balanced fighter, but in the end he won’t be able to overcome the magical might of Zelda. One light arrow should end things (Since Mario’s cape couldn’t reflect such an attack) Zelda wins.