I'm interested but I need to narrow down who I'd want to RP as in this setting.  You said no villains so people like Ganondorf or Bowser are out.  Luigi's taken...  NiGHTS is mentioned already as part of the npcs.

Here's a few questions while I sift through the characters:
You said "hero" characters.  Does this include party members and sidekicks or is it just the main player character?
Digimon was originally a Tamagatchi-style electronic toy made.  Could someone be a Digimon since it was originally a pet-raising game and there are many original setting Digimon games?
What about villainous protagonists such as Marche from Final Fantasy Tactics Advance?  They are the "hero".
And what about a character such as a NetNavi who are digital beings rather than flesh-and-blood or metal-and-power?  Would they be embodied?  How would this effect their abilities?