It would be amazing and not all that difficult to do either. By using the standard sprites for characters, along with color swaps like different color armor, horses, pegsi, wyverns etc, it would be easy enough to make the change without taking up too much space on a disc. For portraits, maybe 40 unique faces (half male, half female) and 20 or so hair styles each with say 8 or so color variations like red hair, blue hair, brown hair, blond hair etc to make that part look unique as well. The stats, percentages and everything shouldn't be that bad considering how easily one can hack a character in the GBA games so that should still be completely doable.
Really the only thing that would take up a lot of space is the scenario and map creation feature. But really, wouldn't it be amazing to be able to create a group of 10 or so FE characters and make your own little adventure for them? Maybe a part that FE's war, or maybe something completely separate that you made yourself. Of course, I'd hope for some online availability so everyone could share their maps and scenarios with others, but that's just me.
As far as supports and storyline goes though, it would be difficult to somehow type up everything using even the Wii considering the lack of key board so that might be a bit of a problem. But then again, you can't have everything... although it would be nice to have the characters you created have actual supports together so other people could read them and make them appear to be a little more 'real'. Oh well, here's to hoping that IS developers like to use web spiders and read what all their beloved fans want in a new game. After all, FE4 gave us pairings with children, SS gave us branching promotions (I think), RD gave us 3rd tier units and FE on the DS did give us the ability to switch base classes. Now all we need is to be able to create our own and make our own FE adventures and we'll be set! Come on IS, make us completely happy and give us the ability to do your jobs ourselves! Heck we'd probably even be ok if we had to download the extra player made 'chapters' from your website at a small price (2 or 3 bucks each) as long as the gameplay stuck.
Special announcement for this topic: Ha ha! Did you really think I cared enough to make something special for you?
It would be great, but it'd prolly only appeal to a very nice market. Fire Emblem fans first off are pretty niche, and then even out of them prolly only a small percentage would be into it. I know I'd love it though, and it doesn't seem that hard to do.