Well, considering your previous avatar (Potemkin from GG), I saw that coming a mile away.
Grapplers - traditionally they're bulky guys that look like they were spawned during a wrestling match, but how about making a small-frame dude be a grappler?

Small-sized grapppler would be nice. Big and bulky grapplers have the advantage of brute strength, but small a grappler (with the right technic) can take down larger people quite easily.

For example, a simple armbar (the way I have learned it) bends your target over, and then you can follow up with other stuff. However, if someone is much larger and the armbar is done correctly, a taller target will bend over more than a shorter target, resulting in the taller target being off-balance and more vulnerable.

Small fast grapplers have been done, such as El Fuerte from Street Fighter 4, or Ramon from King of Fighters XI. I'm sure there are more examples. Both of these examples are luchadores.

The world does need more smaller acrobatic grapplers though. And though luchadores are awesome, they don't all have to be one.

IMO, with character design it's all about balancing the contrast (though this could be said of all art under any definition). It's like, how much do you wanna change the stereotype. Stereotypes, in terms of character design is good, as it implies a lot of depth and gives a lot of legacy to your character that you don't need to manually add. This is especially important in fighting games where you won't spend dozens of hours in a narrative with each character, as you would in an RPG or adventure game.

But then, you run the risk of being too stereotypical, and no one likes that. You then, have to add memorable and unexpected deviations from the core stereotype you are working with, like the small wrestler, or the male sex symbol, or the effeminate boxer or what have you. But then you run the risk of being too dissonant, and your image just clashes with itself rather than providing interesting deviation.

Of course you can be wholly (or at least more) original with your character design, but fleshing them out and really making them "full" characters is hard to do in a fighter. And of course, unavoidably your design will remind people of other characters and ideas, so an idea is never really isolated and one must take that into account.

Unless it's BlazBlue.

Well, looking back on the thread, here's the cool ideas:
-CAKE: could represent Nazi occultism, the 'hard-to-kill' character type with some long to medium range attacks.
-Hrodgeir: Norse mythology. Big traditional grappler, plaited beard, whatnot, has a lot of throw moves.
-British wizard, would be the seemingly-weak guy. Uses wand as well as book to attack, maybe transform into part animal for some moves.
-Crescendo: maybe a djinni? good combo user, think somewhat like Taokaka. Maybe also some air time.
-Samedi: voodoo dude. attacks are tricky to both the player and the enemy, think of traps.