I'm legitimately surprised that you haven't talked about the dangerosity of Neutral Air any further. That move's actually pretty busted, no matter how you look at it. Its main advantage is that, at low to mid%, it's a combo starter to small, but fairly strong combos since the move combos into itself, into UpB, and a fair amount of mixups depending on the situation. With that in mind, i believe the metagame of Game&Watch should be aiming towards a stronger implementation of these tools in the neutral game, which can truly push people into shielding a bit more vs G&W, which is something we want for the aforementionned & known reason that we do have pretty busted combos off of it. You may also be aware that at low%, UpSmash is also a combo starter to such things as UpSmash -> Nair -> Nair -> UpB, for a clean 50% ( roughly ) on a majority of the cast.
I believe the current issue with the G&W metagame is that his playerbase is kind of weak in general, and hasn't shown a neutral game that has been rather predictable, and very linear. Ideally, a good G&W would take a fair amount of bold decisions, perhaps negative trades against the opponent to attempt and setup combos with something other than our grab, because our combo starters are deeper than that. Landing UpAir, UpTilt, Landing Nair, Nair in general can all act as combo starters in a closer range that could make our close up game a little bit deeper. Mix that in with the usual ground game with his amazing foxtrot, great jab, with some smashes for baiting purposes ( They're all underrated for that, they're more practical than their frame data suggest ) Our safety & ability to crossup will also definitly be in our favor. However, that still leaves us prone to charas with stronger OoS, and against the safest, most defensive characters, this has to be done very carefully.
On to matchups, I as well as a fair amount of G&W mains believe we actually do very decent against Sheik. Songn even thinks we win this matchup. I'm surprised you haven't mentionned Sonic, which i consider to be by a fair amount G&W's worst matchup. After this matchup, Diddy & Rosalina come in mind. On to fairly good matchups, i would like to mention that Meta Knight & Mewtwo have been leaning towards even at best, with wins of Regi over Tyrant & Gigabasu over Abadango in mind. On to high tiers, Ryu, Luigi, Lucario & Villager are all fairly good for the 2D Black piece of paper.
Overall, much like Yoshi ( in my opinion ) , there's a lot left to explore for G&W players to deepen their neutral game & make themselves less predictable in the ways of being threatening to the opponent. With that in mind, i could see G&W easily rising up to Mid Tier, with a weakness to the characters with some of the best defensive tools, whether it's within their neutral, or with OoS. His current worst matchups, as well as characters like Bowser will turn out to be winnable but difficult.