HIDDEN CHARACTERS

There are a sizeable number of hidden characters to unlock in "Digimon Rumble Arena." They can all be unlocked on any difficulty level.

MEGA FORMS - complete the game with any Digimon, and their Mega form (or Stingmon for Wormmon) will be made available to play as in Two-Player and Vs. Computer modes, as well as the Mini-Games. However, they cannot be unlocked for One-Player mode.

REAPERMON - complete the game once with any Digimon to unlock Reapermon, the game's final boss. Complete the game again with Reapermon himself, and you'll unlock his stage ("Abyss") to play on in Two-Player and Vs. Computer modes. Ridiculously powerful, and nigh-unbeatable if another player controls him rather than the computer. However, if the computer IS controlling him, if you play against him in any stage other than his own, you'll find he's a lot easier to handle.
Triangle - Grim Slasher
Circle - Bone Duster
R1 - ??? Cyclone (can't hear the damn thing's name)

OMNIMON - complete the game with Agumon and Gabumon, and Omnimon will be unlocked. Powerful as all get-out, but not as fast as you might like. His attacks have the range to make up for this, though. Curiously, he's missing his cape.
Triangle - Transcedant Sword
Circle - Garuru Cannon
R1 - Double Threat

IMPERIALDRAMON PALADIN MODE - complete the game with Veemon and Wormmon, and Imperialdramon Paladin Mode will be unlocked. Merely a white recolour of Imperialdramon (hence he's not got feathered wings), PM's two basic attacks are the same, while his R1 attack uses his Omega Sword, rather than his Giga Crusher. There's not a lot of difference between him and regular Imperialdramon.
Triangle - Splendour Blade
Circle - Positron Laser
R1 - Omega Sword

IMPMON - complete the game with Guilmon, Renamon and Terriermon to unlock Impmon. Impmon can evolve to Beelzemon during play. Gloriously fast, with rapid-fire attacks that'll do a lot of damage, particularly Summon, if you can get the opponent right over it.
Triangle - Summon (hold down for a continuous stream, release to fire)
Circle - Badda Boom

BEELZEMON - Blast Mode, actually. Complete the game with Impmon, and Beelzemon will be unlocked. Unlike the other Mega forms of the Digimon, Beelzemon IS available to play as in One-Player mode. Slower than Impmon, but still pretty powerful.
Triangle - Darkness Claw
Circle - Dark Ringer
R1 - Chaos Flare

BLACKWARGREYMON - Certainly the most difficult to obtain, you must play through the game without losing a round. Then, in stage six, BlackWarGreymon will challenge you. You must defeat him without losing a round, and then go on to fight Reapermon and, again, defeat him without losing a round. Accomplish this, and BlackWarGreymon will be unlocked. Effectively the same as WarGreymon, just with more speed and power. His grabbing technique is different and more damaging, and he is also able to fire his Terra Destroyer while standing on the ground (although it's more effective to jump).
Triangle - Black Tornado
Circle - Dragon Slayer
R1 - Terra Destroyer

OTHER STUFF

ALTERNATE COLOURS - In Two-Player and Vs. Computer modes, it seems as though it's not possible for both players to select the same character. However, if the second player hilights the same character as the first player, then holds down Select and presses X, he will be able to play as that same character, in an alternate colour scheme.

ALTERNATE DIGIDESTINED - First, complete the game. Then, when selecting your character, hold down either L1, R1 or R2, then press X - the DigiDestined partner of your Digimon will change appearance. This technique only works for Agumon, Gabumon, Patamon and Gatomon (and their Megas) - and will make their partners look like their season one selves. It also works for Wormmon and Stingmon, where it will make Ken look like the Digimon Emperor.