But honestly, I can't imagine Tekken using SF engine. I've played both 2D and 3D fighting games, but how would Tekken characters' special moves look like since they focus on spamming combos and juggles.
The simple answer is this:
Each respective development team gets to take the other side's characters, and "tweak" them for the sake of their side of the playing field. As you saw with Ono's version of the game, the result is that you take the "flashiest" aspects of the Tekken characters (like Kazuya's EWGF), and convert them into the "QCF/DP/360/etc." notation and move propety that Capcom fans will recognize. From what we saw, it looks like Kazuya converted well enough to the rulings of the other side, and I expect the rest of his pals to follow suit.
Frankly, I'm much more interested in seeing what Harada and the Tekken team will do with Ryu's gang. For the first time in years, Ryu may actually stand to have more NEW MOVES, since the typical Tekken character averages about 100 moves a piece.
Harada and his group definitely have the bigger "design challenge" on their hands, and that's probably why I'm tentatively more interested in what their game will look like. Akuma/Gouki's SGS could be made into a complex series of chain grabs that could make even regular players of King blush.