My theory -
Mario and Luigi are from Earth and are marooned in the Mushroom Kingdom. All other humans in the Marioverse are either from Earth or descended from humans who originated from Earth. Princess Peach is native to the Mushroom Kingdom but her ancestors were from Earth.
Since the Mushroom Kingdom is on a different world and probably in a different dimension to Earth due to its weird physics, the Superman effect comes into play, explaining the Mario Brothers powers. Some of these powers are evidently inherited by native humans, too - explaining Peach's powers.
The Yoshi's Island line, where the Mario Brothers are twin babies - that's got to be a different reality. Assuming the rule that you can never meet yourself if you go back in time, I reckon that in the game Partners in Time, Mario and Luigi (older and younger brother, native to Earth) went back in time and to a parallel reality where they teamed up with a version of their infant selves who were twins, and native to the Mushroom World. This makes both timelines possible, and settles any arguments about where Mario and Luigi were born, and whether or not they are twins.







