She is Physalis, a M.U.G.E.N character created by Lates. She is a fusion of Phyqhical and Alice Margatroid, and the counterpart of Hei Meiling, who is Lates' another M.U.G.E.N character.
See also her pixpedia article and sample videos: (NicoNico / Youtube)

Psyqhical is Zelgadis' original character created as the final boss of his game, "THEKING OF FIGHTERS MEMORIAL."
See also Psyqhical's pixpedia and Nico Nico MUGEN wiki.