Final-Fan said:
It's an alteration of one with a horse instead of Celestia. But it's just the same thing (even the background) only with a brown horse instead of Celestia -- still just random upside-down humor.
About the pony nobility, I don't think Blueblood is an alicorn, so it can easily have some odd historical explanation, like some random pony kingdom getting folded into their realm. After all, the Hearth's Warming Eve story told of Princess Platinum ... who can be assumed to be a unicorn due to the whole three tribe thing. Cadance is tougher, being an alicorn (which it's my understanding wasn't originally the plan).
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The major problem with Cadence (as, i think it was Tadpole Jackson, speculated in this thread) is if we take the whole "Niece" thing literally, then she has to be Luna's daughter, which is in turn most likely impossible due to the Nightmare Moon thing (because Cadence looks younger in her flashbacks with Twilight, meaning she's aging at a somewhat normal rate, and thus is likely only some years older than the Mane Cast).
The whole Cadence thing is a bit of a blemish on a show that has generally put a good deal of focus on continuity.
The core idea i'm playing with for my maybe-someday fic is that Celestia and Luna were deliberately made as living weapons to fight Discord with consent of the ruling triumvirate of Equestria (Earth Pony Chancellor + Pegasus General + Unicorn Monarchy), and that these "royal others" are long-line descendents of the latter, with some interbreeding going on creating a rare Alicorn in Cadence.