Koume and Kotake in
MM were the people who lived in the swamp with the Deku palace and the monkeys. You know, you had to give one (Koume, I think) the Red Potion by following the monkeys?
And, as others have said, it is simply because Nintendo didn't have the time to use new character designs, so they used the old ones. Then the parallel world rumor started. Come on people, Parallel World could simply mean something like the New World and Old World! It's probably just on the other side of the planet, or somethin'!
No, I do not agree with the alternate dimention theory.