The thing with either of the Monsters movies is that since (the monsters think) humans are toxic, then how can it work out? Unless it takes place AFTER MI, or they have it so that Sora & co. arrive after they realize Boo is not toxic (which is what they would likely do) , then it would not work out from that logical stand point. It pretty much confirms that unless Sora/any other human character like Riku or whoever is able to transform into a monster or don a monster suit, then MU is definitely not going to happen.
Them transforming would not make much sense especially if they go with the concept like in Christmas Town that the Santa of that world is THE Santa clause that would deliver toys to Sora's/other worlds, in the sense that the Scarers have been coming through doors to scare Sora and other people of his world. They did transform in Atlantica which had humans but that was because that world had its own magic from Triton and Ursula among others that could turn people to mercreatures among other things and obviously they would need to breathe underwater.
To clarify, what I am saying here is that they cannot logically transform in a world like this where there would be humans through some sort of connection (Toy Story would be different because they would have to be toys for obvious reasons and because, though I cannot explain it, it just makes sense with Toy story, but not with MI). Then again, there is always the unknown reason why Ven shrank in Castle of Dreams, so that could work out for them becoming monsters.
(sorry if the above is confusing to understand, I'd be happy to explain more clearly if need be)
