I have begun prototyping my fighter in Game Maker. Once the simple prototype is complete, I'll be moving onto developing the full game in XNA, rather than Flash/Flixel.
The full game will have HD hand drawn manga/anime style graphics, drawn by me, so you're not just looking at a jumble of crappy pixels on your big screen TV.
That's all for now! The prototype game will be posted for free download. The full game through XBLIG will cost you some pocket change, though.