With CGI not as advanced back then, I'd say no. Maybe now they could, though. But I think they should make it more like the game and not try to make some weird offshoot like the 1993 movie. Add some more plot to the story, and I think it could be done well.
shareLive-action was probably not such a bright idea at the time. I could have possibly seen, maybe, an adaptation in the form of a cartoon. The technology just wasn't there, and it was so blatantly obvious from the effects.
They did have The Super Mario Bros. Super Show! (1989). Even though it only ran for one season, they should have proceeded to make that into a movie.
But, I guess some people actually do like cheesy movies. I know I watch a lot of bad films.
If there was ever a movie that needed a reboot, then this is it. I usually hate the idea of a film being remade, but this would be a perfect opportunity to get it right this time around. They'd probably make it dark and gritty.
Yes - look at the earlier The Neverending Story 1 and 2, Labyrinth, The Dark Crystal, Star Wars original trilogy, et al.
A Mario film set in the Mushroom Kingdom was absolutely possible in the early '90s.