Even if it were legal, it would not necessarily be ethical. People incorrectly assume that when something is ubiquitous, it should belong to the public.
Super Mario is not something that has always existed or would eventually exist, it is a creative work that became successful through Nintendo's efforts. There is nothing wrong with Nintendo wanting to reserve their rights to it.
That is not to say that Mario fan works are not enjoyable - there are awesome Mario ROM hacks and Flash animations out there - but that people shouldn't feel entitled to the rights to make them and to complain when Nintendo takes legal action.
I can't answer that, but my above point is the premise of the linked article.
Nintendo is reaching disney-level reliance on their cartoon hero, (probably worse) so I wouldn't be surprised to see them becoming another copyright-extending villain over the coming decades as they struggle to survive with their seeming lack of creativity.
Sure, Apple has trademarked Apple. MS has trademarked Windows. Why not Mario? It would have to be limited in use to video games, electronic entertainment, or whatever the narrowest category for such things there is.