Sure, Dynasty Warriors is milked, but do you think Mario is milked? Or is this basically a "No way."?
Individual series aren't really milked, but the FRANCHISE is milked. There is really no way arguing against that. Literally hundreds of Mario games have been released across various platforms for years, and it is not uncommon for the character to star in at least five games a year. And lets not even get started on the various spin offs starring other Mario characters like Yoshi, Peach, Wario, Donkey Kong and Luigi.
The real question, I think, is does it really matter? I don't really think so. The entire reason why the character stars in so many games is because he's had so many spin offs that have done well enough to essentially warrant becoming their own franchises.