Ok this thread has probably been dead for awhile. But as a fan of both SNK and Capcom, I'd like to put my 2 cents in. Now judging by the charaters in the fighting games themselves, I would have to give the fight to Terry. Why? because Terry Bogard has a kick- ass arsenal of moves; power dunk, power wave, round wave, burning knuckle, rising tackle, crack shot. Not to mention his assortment of desperation moves, buster wolf, triple power geyser (which one blast cancels out any other projectle, even a Shinku Hadoken in CVS 2 AND SVC ), rising beat, power stream, and rising force. Now not to say that Ryu's moves are weak or anything, but for heavens sake, has he learned anything NEW since street fighter 2?!! same old stuff, Hadoken, Shoryuken, Tatsumakisenpukyaku for his special moves. with Shinku Hadoken, Shinku Tatsumakisenpukyaku, Denjin Hadoken as his super moves. It just seems to me that he hasnt really learned any new tricks in his "path".
As a reply to the whole thing about Terry's disadvantage because he fights with anger and maybe even hate. Well he fights with controlled anger. And what about Akuma, he is pretty much the strongest of the Capcom universe, and he fights with anger, even murderous intent and could beat Ryu's ass. So I guess that probably would'nt be too much of a disadvantage.
So I would give the fight to Terry, not saying he would win easy AT ALL he would probably be utterly exhausted. But I he would use his ability to adapt and beat Ryu. Maybe forcing Ryu to go study a few other techiques.