I often times found the "gore" and pain of SamSho to be much more... meaningful than MKs? Sure MK used digitized actors. But SamSho had a more relatable, interesting cast that had better voicework and personality. Being "Cartoony" shouldn't really make it easier to watch a lovable character murdered.
If anything, I want to see more contextual violence in this game. I think it gets stupider and stupider in games when you can have a father like Johnny Cage brutally murder his own daughter in MK. You remove layers from the characters personality, when you force them to play by the games rules, and not things related to themselves.
Nakoruru's bloody stab in the reveal trailer is on the right track. Her sorrowful eyes being shown, as she does what must be done to progress, makes sense. Why not go a step further, and have her wound her sister, to send her back home, rather than murder her? If you're playing a nicer character, keep the kills more artful and tact. If you're playing a bandit like Earthquake, make him clumsy and disconnected from the actions. But someone like Jubei, or a pure monster like Kusaragedo? Yeah, things could get very harsh and messy, for anyone in the cast.
Instead of just thinking of having a blood and gore on-and-off option, I'd love to see some of that integrated into the cast. Like Black-Leg Sanji's "I'll never kick a lady!" rule in One Piece, why not have characters that refuse to critically harm others, as part of their lore? Regardless of what one feels of Kenshin's creator now, the "Reverse Blade" style giving all the drama and style of bloody sword fights, while, ultimately, somehow not killing people, is a perfect thing for a game like this.
Heck, Ukyo has been acting as if he's on the verge of death for the ENTIRE SERIES. I'd kinda laugh if sometimes, he'd just... die anyway, after a hard match, even if the opponent didn't kill him. Living by the blade is a harsh lifestyle...
