Vanilla Sagat reigned for two years (arcade, plus console release) and SFIV fared fine.
SA2 Chun has never been nerfed and 3rd Strike is still going strong in Japan, Europe and parts of Asia.
Cable, Magneto, Storm and Sentinel were never nerfed and Marvel vs. Capcom 2 has a storied decade of competitive play.
People always use this argument and as someone who has been in the scene since SFII this is kinda crap. (YES I AM OLD)
First off Vanilla Sagat, while amazing, was not a game destroying character. Even then he forced anyone playing certain characters to have counter picks. He was oppressive sure, but to see a Sagat who breaks the game utterly we need O.Sagat, who by his very existence makes many characters unviable in Super Turbo.
Either way though, horrible balance doesn't mean people won't play a game, but it doesn't do the game any favors.
SF3 and MvC2 existed during the dark ages when options were very limited. Second SF3 has such strong defensive and universal mechanics (Parry mostly but also universally high damage) that good reads can win a match for anyone. You're still talking about a game that had Evos with 6 Chuns in the top 16 and that in long sets has 3 viable characters.
MvC2 is actually the ultimate example of why we should patch games. You have four viable characters in a game with 52 characters. Yeah people play it competitively, but you're talking about having 8% of a game's cast viable. That's awful.
MvC2 is so broken that you have a character who has a reliable infinite into guardbreak that guarantees a full team kill on a touch(Iron Man), and he isn't even considered competitively viable. Do you get how dumb that is?
Basically you're holding up as examples a few games where the only option in high level play was to pick a new character. Do you like that? Do you like losing at the character select screen? Is that really what you want? Cause your examples reinforce that you'd like to have a screen full of characters where 1 in 10 is actually an option.
I honestly prefer smaller cast games where I at least know that all the characters are useful. (KI+Skullgirls) But I think hoping for more than 3 viable characters in a game with 30 characters and 3 variations for each isn't unreasonable.