I always thought Sticker Star was Nintendo and Alphadream saying "Okay, we have a bunch of assets on the table for a new game, what do you guys want to do?.......I guess we could take Sticker Star's assets and mash them up with Dream Teams

. Great idea, here is a budget and access to the assets of Sticker Star, have fun

!"
Nintendo went into budget-mode last year to get software out faster and like Tri-Force Heroes, Paper Jam was the result of making a brand new game using little new assets as possible to save cost.
So, the reason for the lack of Paper characters from 64 and TTYD was due to not re-using assets.
Then again, they could of asked IS's for the TTYD assets as with some tweaking they could look great on the 3DS.