When you said Balloon Fight, I almost jumped right through the roof of my car. That is one of my all time favorite NES games, and I have been racking my brains for years now for a way to bring it back.
I think the best idea I had was in the later part of the N64 era. It was basically just an idea for the original Balloon Fight, but in a slice of urban 3d space using the (then revolutionary) Z Targeting system to lock on to your foes. The urban environment would have all the rooftop perches you would need to replace the platforms on the original title, traffic below could replace the sea monster (but would obviously be no where near as awesome!) and you could have some low flying aircraft replace the balls of lightning that would chase your around if you took too long on a particular level in the original. Maybe the original sea monster could make an 'Easter Egg' style appearance if you flew too close to an in game body of water, like a pond or river or something, complete with the chip tune melody that played when a critter got snagged in the original game.
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