Don't try to make competition fun. Competition is fun on its own. When you try to make a competition fun, it complicates things and, usually, does the exact opposite. Go to a tournament, have fun, and then realize items aren't needed.
The game's not balanced, but neither is any other **** game ever made. IF you include the dragoon, seriously, then you basically just said that at least one stock is going to be lost at 0% or the final hit will be with the dragoon. That's how it is. So, no. I say screw all items in tournament play.