Isn't this already a pretty popular theory to begin with? I mean, not JUST the Link and Kafei thing, but the whole parallel dimension and all the characters being the same thing. It's even referenced in chapter one of the manga I believe, although, that can't really be considered as canon anyway.
I personally agree with both theories. The one about most of the characters being parallel is fairly straight forward, and makes a lot of sense, seeing as a lot of key characters throughout the game are considerably similar in not only appearance, but personality to characters throughout Ocarina of Time. It seems most of the people that look the same either have the same, or exact opposite personalities.... *cough* Ruto *cough*. As I also stated before, the manga references it, when Link runs into I believe, correct me if I'm wrong, the Gorman Troupe in Clock Town. He notes that Ingo looks very similar to the person he sees there, and I think he even confuses him for Ingo at first.
As for the Link and Kafei thing, I really don't have much to add to it other than what Danny already said in the previous post. The only other thing I can think of to support it that, surprisingly, no one has mentioned yet in this thread, is that, of course not counting transformation masks, Kafei is the only character other than Link that you ever get to play as in any Zelda game, at least as far as I know. Dang. THAT was a run-on sentence, oh gosh haha. Was there any other way I could have worded it though? Eh, whatever.