That's all incorrect. Almost any Playstation character can easily kill any Nintendo character, yes. But you forget someone...
Link + Master Sword + Triforce of Courage = Almost Unstoppable
Ganondorf + Triforcoe of Power + Demise Evil Incarnation Powers = Immortal Being
Samus + PowerSuit = Unstoppable
Also Hylian Shield is unbreakable and resistant against fire and electricity.
Meaning Cole is useless, Sweet Tooth Fire powers useless, Big Daddy can't break the Shield, and Link can use his Bow and Arrow, Bombs, Clawshots, Gale Boomerang for range attack.
Having a sword that is good against evil people doesn't gurantee victory it will just make it easier for him. So while it's a benefit to link it is certainly not a win all.
I think the real threats from the SSB cast are Link, Ganondorf, Samus, Kirby, and Sonic.
The big threats for PSAS are Raiden, Dante, Kratos, Cole, Ratchet/Clank, Jak/Daxter, and maybe (or at least a wildcard) in Spike.
Kratos and Dante are arguably able to take on the whole cast alone. Not many characters are as insanely powerful in their own worlds as these two. I mean heck Kratos' only real challenge is that he has to walk to all the gods.
Now there biggest challenge would certainly be Samus. It's not that she is way stronger but she has powers that Kratos and Dante have never really dealt with. Though each games have had bosses that shoot beams, or are ranged fighters. With the Golden Fleece, among other items, and Devil Trigger I just can't see Samus lasting too long. She just isn't powerful enough fror these two OP little guys.
It doesn't matter if Link is a good swordsman or even if his sword is the strongest, Raiden is just a better swordsman. Raiden is stronger, faster, and can do that sweet super speed cutting. Not only that but his armor is pretty much invincible to normal weapons and he can cut through anything.
Gannondorf is simply a powerhouse and being magical doesn't hurt him any. His only real claim is being able to reincarnate/immortal which I'm saying is just a pointless reason if he can't win. It doesn't matter if they spend forever constantly beating him up his team doesn't win because one guy can't die.
Kirby and Sonic are both really weird people for the groups to fight. I think with the wildcard of Spike and his ability to catch things that are very hard to catch, along with Jak and Ratchets insane weaponry and the ability to slow, or freeze, time they coudn't win.
Of course Cole is just incredibly powerful with his crazy number of skills with shields that can deflect bullets, to draining life, to ionic storms.
It's not even really relevent past Kratos and Dante though. They are just waaaay to strong in their own worlds and it doesn't transfer well to let them fight anyone else. It's not like Kratos was beating really strong aliens, powerful warlocks, cyborgs, or anything that is still based in reality. He had fights where he literally killed gods, he's just hard enough to beat.