I heard you do down C then up C while running. But I haven't been able to do it that way, so is it a timing thing?
First, it only works if you make contact. If your dash attack doesn't make contact with your opponent, you'll merely dash-attack in thin air and you won't follow up with the U-Smash.
Second, you need to hit C-stick down a fraction of a second before you reach your opponent to initiate the attack, then you need slam C-stick directly up as quickly as possible. In this sense, you should be hitting C-stick down and C-stick up with almost nonexistant delay between the two thumb motions.
This will cause Falco to initate a Dash-Attack, and then automatically follow the attack with an Up-Smash. The timing takes a couple minutes to get used to, but soon after you'll find it's very easy and reliable to do. In fact, every dash attack you make can be turned into this 'combo' with relatively no trouble at all. There is a remarkably large margin of error when performing this technique.