Who should (and shoudn't) have been on the Sgt. Pepper cover?

Because it's not really a rock and roll record. I mean it falls into that genre, and some songs have a touch of that (the title track does), but otherwise, the music's pretty far removed from Chuck Berry, Little Richard and Buddy Holly!
When I'm 64 just ain't rock and roll. Nor is Within You, Without You, etc...

 

Wax figure sets of each and every Beatles knockoff band from the British Invasion. That doesn't include British bands who brought something special to the table (Kinks, Rolling Stones, etc.).

 

Crowley is actually central to the concept behind Sgt Pepper and its cover art, so it makes sense he would appear in the crowd. It’s not just a random collection of faces:

The Greatest Enigma Part I

 

Things could be a lot worse. The repulsive Jimmy Savile made it onto the cover of The Birthday Party by The Idle Race from a short while after Sgt. Pepper.