I used to care about the timeline... then the Hyrule Historia came out and annoyed me. So now I pay the timeline no mind, still it can be useful to theorise where Zelda U could be placed so that we can better predict what to expect within the game...
I don't think we've seen enough of Zelda U yet to pin it down on the timeline but of the little we've seen of it i can't say that it'd be a sequel to MM... a sequel to MM wouldn't have to be dark or really anything like on MM but i just don't see it. I guess it could be related with TP if it wanted to be... same with SS, WW and OOT which seem to be the more likely at this point outside of a complete reboot or remake of the original LoZ.
As far as MM goes i don't think Zelda U will directly link to it or have any heavy references to it. I'm more inclined to say that Zelda U will fall somewhere around SS be it a prequel or sequel.
At this point i don't care if Zelda U is a prequel or not, it doesn't really mean anything if it is... we just may have to go without the Master Sword and Hylian Shield if it is but we went through half of SS without the Master Sword and through all of SS without the Hylian Shield so... We also never got the Hylian shield in WW... and Zelda U looks to be making a big point about being different, especially aesthetically so, a prequel affords Zelda U to have precious few resemblances to other Zelda games if its far back enough before recognisable items, people and locations came into play.
But yeah... seriously doubt it being an MM sequel, though that'd be interesting.