They probably used some form of assembly for the specific processor the game was being made for. I know MK2 and 3 were on a very strange processor with tons of commands in its command set that they never used.

testing my signature..

I thought I saw in one of the making of videos, I think MK3, they show them doing a throw with Sonya, pausing the game, and changing where the character was in air, all realtime.

Yeah, that looked like it was a custom programmed system, probably running on a test copy of the hardware, programmed in assembly. I believe there is a point in the vid where you see a column if short (around 3 letter) commands and they go through and tweak one. That is assembly.