They had to purge some characters because they were changing over to a completely new art style. The only reason you got 40-50+ charactes in the last few games was because they recycled sprites from 10 years ago.
And honestly, that's the only real complaint I ever get about the game. "It didn't have Mai" or "Not enough characters". I've yet to meet a single person who complained about the, you know, combat system in the game.
If your "standards" for fighting games revolve solely around the number of charactes in the roster, just go play Mugen.