See here, the one guy takes a swing.
All you need to know is the distance between the 2 characters to evaluate if the hit will land or not.
-> next to other factors, like the pose of both, the powerlevel or previous combination (or however complex the sim is)
What is not important (to the simulation logic) is how the sprites look.
Making it look good-> Thats the manual part. You could just (by hand) measure the best distance to make the animation look right.
And if you have several characters, try to make their Heads have the same hight to reduce the amount of
special animations for each character combo.