That was the first. I mean, if they were big time celebrities, getting a Broadway career would have been cake. Especially if they made the movie now... all they'd have to do is take an old movie and make a musical out of it... boom bam, Broadway stars. The real confusion came into Muppet Babies...
it could easily be brushed off as a continuation of Piggy's fantasy from MTM... so that's easy to write off... UNTIL MFC when they have home movies of them as babies. Not to mention the instance that Skeeter does exist outside of the show, but she's been banished into some nonsense about being in a jungle adventure or something. Basically, Muppet Babies proves my point that there's no way a canon can be established. Though VMX takes the events of TMM, only because of the existence of Doc Hopper's... TM does things a little sneakier... taking the instances of the movies into canon, but also referring to them as movies, all the while saying it's a movie.
Plus, Walter has Muppet Babies toys in his collection.