Firefly, Twilight, Applejack, Ember, and the other Rescue at Midnight Castle ponies never returned in later episodes due to some garbage that made Hasbro lose the rights to their own characters.

In-universe, what do you think happened to them? Are they dead, erased by an insidious plague from beyond the fourth wall? Or are they still living decent lives somewhere in Pony Land, just offscreen?

I hope they are not dead. Aside from how cool Firefly is, Ember is adorable, and that whole cute moment with her immediately after Tirek's death for major Mood Whiplash, would feel completely ruined if she was just erased soon after.

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I assume living elsewhere, helping the kingdom they saved but I suppose it can be up to the viewer’s guess. But they did appear in a few of the comics. So maybe they are just busy elsewhere or doing something else when most of the stuff are happening onscreen

I saw a claim that Firefly was meant to make a cameo in a scrapped scene of the (G1) movie. I can’t 100% remember where I got this claim from, or it has been removed, since i couldn’t find it, so chances are it’s not. (think it might have been a wiki of some sort)

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A wiki page having false information on it? That's impossible.

If Hasbro was able to keep those ponies, they probably would have made good core characters for the actual show. Unfortunately, that wasn't the case. Had they stayed, they could have given more to the ponies that were minor in the pilot as well especially those who didn't have any lines. Nonetheless, they did make appearances in the G1 comics, which weren't canon to the show and even featured a comic exclusive character known as Majesty, who never appeared on the show either, but was still in the toy line for some reason. As for Ember, she was the only foal in all of G1 to not only be original, but also not have Baby in front of her name as all the other ones did, which were just foal versions of the adult mares and even looked like them. Overall, Rescue at Midnight Castle ended with Megan waving to ponies that she will never see again, though I still wish that they let her keep her cowgirl outfit rather than that romper suit that she wound with later on.