Im sorry but thats kind of a moot point IMO. In melee and 64 ALL the characters where one character in their series besides LoZ Link and Zelda. Theres no "64 mario" and "GC mario" in the Mario series because mario is the same character in all the series games. Much like how Fox is the same Fox from all his games and Sonic the same Sonic in all his games which makes it reasonable to take elements from anything in any game they where in. LoZ is the only series in smash that has a new main character every game that goes by the same Name of the old main character so I don't think we can just chop it up as "he can and will use any element from any LoZ game like with Mario and etc". As we have seen with Brawl's Link he is willing to change things to reflect the newest form of Link.
The only thing I think Link's boomerang proves is that Sakurai doesn't have to follow the games exactly. That item and move is a staple in LoZ and technically Adult Link is still the same Young Link that could use said item. If Shiek was a staple ablitity in LoZ for most all Zeldas than I would think she would transform again but thats not the case.
And only one Sheikah was in TP. . . If she trained Zelda in TP than it must have been with that sword seeing as Zelda wasn't doing any Ninja moves.
On topic, I personally think her down B has changed. I can't find any reason to not reveal her Bv if it's the same. Even if he didn't update Pika's and Kirby's B moves he did show them too us in vids, pics and demos.
Look, the point I'm making is not that Sheik HAS to be Zelda's transformation.
As long as we are predicting what another human is going to decide, unless that person gives us absolutes, there are no absolutes. We do not know for sure whether he wants characters in smash to represent the individual incarnations, or the characters as a whole.
However, there is some evidence that it's the character as a whole allowing the picking and choosing of elements from any number of incarnations, that evidence would be the inconsistencies with Zelda's spells and Link's techniques (especially Young Link) in melee.
You admitted that it is an inconsistency (and your subsequent reasoning is rather thin since the entire point is that he doesn't have to follow the individual incarnations of the characters exactly, changes can be made how he wishes for the reasons he wishes)....
The only thing I think Link's boomerang proves is that Sakurai doesn't have to follow the games exactly
However, there really is no evidence that he is restricting himself as such, I see quite a bit of explaining away inconsistencies in the "only this incarnation" approach for a character, but no actual evidence that this is the approach taken by the game makers (and the changes in Link's moveset are no less valid under the "multiple character" approach).
Furthermore, since it's a restriction, it's the positive in the argument, so the burden of proof lies on the "only this incarnation" approach, the null hypothesis ALWAYS being nothing (no correlation, no restriction, no action) until replaced with an alternative hypothesis.
That and it simply stands to reason, Link was a popular character before Twilight Princess, his Icon represents the entire series, so why should he as a character in Smash, solely represent Twilight Princess?
I also wish to point out that, even though this approach does not require the appearance of Sheik, a "Twilight Princess visual version" Sheik being designed does strongly suggest that she will appear and by extension that this approach is correct, there would be no use for this except to match Zelda's visual style (trophies don't generally randomly change a character's visual style for instance).
Again, none of this confirms Sheik, but it certainly suggests her appearance over the vast majority of other potential characters.