So I've been playing with the Hero a bit since last night and he is SUPER fun to play with, honestly. Knowing when and where to use his Command Selection is crucial to being good with him. I tend to use one Special Move or Command Selection every 15 seconds or so while balancing it out with some swordplay and dodging/shielding/perfect shielding. I even managed to get all three other Heroes caught in my Final Smash on a four-player match and it was super satisfying, as well as taken out one or two characters with Thwack! But I don't think he's broken, honestly, I've had a few rounds against him as well on the usual level 7 (the optimum level I can fight a CPU before they become OP with perfect shielding galore and driving me insane), and his reliance on Command Selection can be a detriment since he's usually stuck holding still and waiting for a chance to choose a selection. Of course, this is with CPUs, professional players can probably get the hang of his commands really quick and figure out how to optimize them all.
All this being said, one thing I've been thinking about lately and really hope is the case with Banjo & Kazooie is almost all the third party DLC characters from Sm4sh AND Ultimate have had a unique 'Fighter Ability' or gimmick that only they have and makes them more effective as a whole. Ryu, and Ken by extension, have several, including special move inputs based on their Street Fighter gameplay, tapped and held attacks, a fixed jump arc, and even another one in Ultimate with 1 v. 1 facing, Cloud and his Limit Gauge, Bayonetta and her Bat Within and Bullet Arts, Joker and his Rebellion Gauge, and of course the Hero and his MP Gauge AND Critical Hit. It's with that that I really freaking hope Banjo & Kazooie get something based on their games that makes them unique, such as a collectathon aspect or something involving their feathers and eggs. Hopefully we'll see Sakurai go into detail how Banjo & Kazooie work and hopefully they are given the same kinda treatment Hero did.
Only thing I'm a little disappointed with the 4.0 update is no returning modes. I'm really hoping Sakurai gives us an HD Smash Run down the line. That'd be so much fun having Banjo & Kazooie running up against classic Nintendo enemies and getting tons of stat boosts!