Zelda Theories

The Happy Mask Salesman

I believe the Happy Mask Salesman is not a God of Chaos or grief or anything supernatural. He is, as simple as it sounds, Link's subconscious.
"You've met with a terrible fate, haven't you?" is the first thing he says to Link, let alone after Link turns into a deku scrub. He not only knows that Link is not naturally a deku scrub, but that Link is also upset or unwanting of this occurrence. The fact that he also sells masks, in which stated earlier is Link's way to gain recognition of others, is also something that could tie in with him being Link's subconscious.
However, if you have ever played Majora's Mask and failed to retrieve your ocarina then you'd know the shocking horror that of which is the moon crashing into the clock tower and wiping Termina off of the face of the planet. But, who is the first person Link sees after this? Our delightful salesman. He sets time back for you so you can have Link get another go at retrieving Majora's Mask. But, no physical damage is done to Link, only the now impending fear of having experienced the crisis - Which would lie in his memory banks.
Going back to the masks being recognition, this could also be why he wants Majora's Mask back so bad. It is Link's evil half or self, and retrieving it from Link could just be Link suppressing his evil wants to the back of subconscious.