I believe some are, some aren't. For example, you can clearly see Skarlet in the tournament for MK1, but you don't fight her (and thus it's implied she was eliminated from the tournament).

If you listen very, very closely to one of the cutscenes, it sounds like Shang Tsung in Kahn's Coliseum says "the next match is between Kenshi and Reiko", which would be an entertaining thought.

I joke that Rain heard about the fighting, but got lost in the palace and ultimately missed all the battles.

no cause they are only used in the arcade ladder which most of the endings are not canon

Skarlet: Background character in the MK1 portion of Story Mode

Kenshi: Mentioned in Story Mode(forgot where)

Rain: ???

Skarlet fits fine into the canon, and with a small retcon, Kenshi does too.

It's the thread I inspired!
Anyway, I'd say they have some form of canon.

Skarlet was obviously there for the first tournament, though I think it was just a little cameo. I think it's safe to say she's canon.

Going off of what was learned in MK:D konquest, Kenshi missed his chance to go to the first tournament (which he was invited to), so I'm sure he found some way to get to that second tournament no matter what (albeit via retcon), and his ending does fit in with what he does in MK:DA beyond (other than killing Shang.)
Plus, he was mentioned in story mode once, though just as a little easter egg.

Rain...don't know yet. Most likely to some degree.

Oh, and I didn't say she wouldn't fit in; I said she (Tanya) wasn't doing anything notable at this point, she's just lingering around in Outworld, since Edenia doesn't exist at this point. That doesn't sound very interesting.

Well, there individual stories don't really effect the main plot, so i guess you could just assume they were going about there business the entire time.

Skarlett's seen in the background a few times but is not mentioned by name by any of the characters.

Kenshi is mentioned but I think that's more of an easter egg than anything.

Rain.. should be in the story mode.. once again, I continue to stress that Rain should've been in the initial roster and Quan Chi should've been DLC in his place, but I digress.

This. Rain=Intial roster Quan Chi=DLC

I agree. 100%

i remember someone saying that it was Kratos when Shang Tsung annouce the next fighters

Frankly, this game is clearly operating on two seperate levels of "canon" at this point...

Story mode obviously has its own linear tale to tell.

Arcade mode obviously contradicts that tale (and itself) on a number of occasions... but frankly, is more in line with what we usually see from an MK game's story...

And as of right now, we have NO IDEA how they will reconcile the two in MK10. It wouldn't suprise me if the main plot of MK10 is built off story mode's ending... but it also wouldn't suprise me if it cherry-picked a few details that spawned from Arcade mode too.

As it stands, we really have no reason to assume the DLC characters couldn't have been present but unseen in "Story Mode's" canon. I mean, hell, Skarlet IS seen... and if it makes you feel better, you could say that Rain and Kenshi making background appearances in the pit and the temple confirms their presence.

Frankly, I'd be perfectly willing to accept Tanya, Frost, Daegon and every other BG character as "Present but not featured" in the plot of this game.

We clearly see dozens of nameless fighters participating in these tournaments. No reason these guys couldn't be lurking among them.

In any event... as with every Mortal Kombat game... ever: The next game will sort it out. Until then, we don't know what's canon.

IF anything...

Skarlet - Shao Kahn most likely ordered her to watch Quan Chi and make sure he isn't screwing around. Chances are, she got caught up in the chaos of everything, and missed out on majority of the story battles. She's most likely still alive, finding out that Shao Kahn died by Raiden's hand, and MAYBE putting the pieces together that Quan Chi was responsible.

Kenshi - He most likely tried to confront Shao Kahn and Shang Tsung, but may have been defeated due to his current inexperience in contrast to the future. Chances are, either he's been rescued and recruited by Johnny and Sonya, or he's been rescued and under training with an non-controlled Ermac.

Rain - He was most likely a leader fighter in Shao Kahn's army. Again, he most likely got caught up in a massive fight, but was not seen later on. If anything, he's either picking up the pieces after the fight and trying to find a new future.....or was convinced to defect by Tanya and Shinnok.