I think the small size is part of the charm. It should never be used in anything other than a 1v1, but it's not so small you can't compete.
Except for Boozer+ challenges
Cmon, it's a perfectly fine neutral, as far as the definition of neutral goes. It has a unique platform layout, doesnt move, and its platforms create a battle for vertical space rather than horizontal space like, say, on FD.
Banned in doubles?...eh...yeah, i can see the problems there. But that's what the WWR is for, mirite? WarioWare Replacer?
EDIT: Just got back from testing Lylat's ledges...
The problem with Lylat's ledges isnt that the stage tilts, it's that the sweetspot is somewhere
above the actual ledge. The tilting just aggravates the problem.
As Falco, aiming for the bottom of the tiny wall near the edge is just plain suicidal. The sweetspot range doesnt go down that far. However, lining up the middle of your body with the plane of the stage, then phantasming
and holding toward the stage guarantees ledgegrabs, unless you didnt factor in the tilt. Attempting a firebird from above is also suicidal if you aim for the bottom of the mini-wall, rather than the grabbable top. However,
you must let go of the control stick to grab the ledge - holding in will cause you to pass the ledge, even when going perfectly horizontal.
In other words, know your edges before you bash teh stage