Yes. Iceguy is doing that with his Paper Mario hack, and to a degree Brutal Mario already does this:
http://www.youtube.com/watch?v=vRRIJ7qrxhU&list=PL60E0546C9B4C1563&index=21&feature=plpp_video
As does this hack:
http://www.youtube.com/watch?v=EKUqgpvBcmw
I presume you can do so with those various dialogue patches or whatever and some decent asm coding.
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As for Mario's Nightmare Quest? Well, it's currently on Fusion Gameworks, ROM Hacking.net or the GCN at the moment.