Allowing others to play my unique Mario fan game

I don't think Unity is going to stop you from making a Mario game, but if you want to release it on a Nintendo platform, you have to pay extra and talk to Nintendo about it too. In any case, if you intend to charge money for it (and depending on Nintendo's lawyers), you may need to get permission to use the images and sounds etc. This is true of any content you want to essentially copy and do something with. If Nintendo hasn't shut down Game Maker they may ignore Unity-based content too. Unless you make money from it.

you can make whatever you want

if you are dieing to make a mario game

go for it, but either get permission from nintendo (which is unlikely free if possible at all) or

whatever you produce make sure your name isnt associated with it

your game can go viral across steam and as long as no one knows it was you that made it you cant be sued

Unity is at no risk simply because you released them of any when you signed the T&C nor will THEY terminate any games mostly because it would be bad for their business but also because they made that possibility beyond their control.

but i come back to my original point which is as long as you dont mind taking extreme precautions with producing the game without your name attached and or dont mind the threat of being sued for everything and your first born then go for it. would be impressive if you could make a good game in Unity under those conditions, the kind of fame that gets passed around word of mouth.

honestly this should probably be closed as off topic. Your basically asking for legal advice on a game programming site. :P

unity lets you compile .exes you can share those exe's with whoever you like and the people at unity don't care so long as you don't use unity pro features in an unlicensed manner.

Beyond that The extensive use of copyrighted material is prohibited by law, fair use policy dictates that should the use of copyrighted material be insubstantial in relation to the whole and based on the affect to the value of the copyrighted material not have much negative change it is generally allowed.

You can be sued for anything. Even if the suit is without merit a suit may be brought forth until such time as it is found to be without merit as a matter of law.

The act of simply not defending your copyright is all but legal grounds for it to be copied. As such many companies aggressively defend there copyright because any failure to defend it previously can be used at a later date as evidence for the defense.

This is part of the reason Elder Scrolls for example sued minecraft maker Notch for a game called Scrolls.

The suit is probably without merit but for the cost of a cease and desist letter they can't have it crop up later that allowed an rpg made by notch called Scrolls to be made so....