I never really thought about that. I guess he could be... that would suck. Willy's Castle looked like a great stage. You know how Smash is though... Final Destination/Fox or Metaknight (depends on which game)/No Items.
Your location is not a real location, but mine is. Here in Midwest-West, we've had lots of tournaments with large stage lists, and that often includes stages with damaging hazards. I can tell you that they don't tend to cause any problems at all, and yes, all the hazards in Brawl are reactable if you have sufficient stage knowledge (you can't react to individual cars on PTAD, but you can avoid the waves of them). Just remember that the only things that are banned are things we allow to be banned. Be pro-active, be involved, and try to do your part to make policy what is right, not what you think is inevitable.
Also, I'm not sure this style of stage is inherently broken. The only real problems with Mushroomy Kingdom 1-1 were the very low ceiling (which was way too good for a few characters, mostly Snake) and that a few characters had gimmicks that really abused the geography. It also probably scrolled too fast which could lead to you getting trapped by aggressive spatial control a bit too easily. Honestly I'm not convinced the stage was truly "broken", but it was not among the more fair stages for those reasons at least. We raised the ceiling a bit, slowed down the scrolling, and fixed the character specific abuses in BBrawl, and the stage was about as fair as Rainbow Cruise except it favored ground characters instead of aerial characters (it was a really great stage honestly; I played a ton of games on it with great results). In any case, we don't know what's going on with smash 4, and it's very, very important that we keep an open mind. We need to play the game for what it is and react to the unique circumstances that the game itself presents as we make rules. Just looking at particular features we historically don't like, saying ban, and closing our minds is not going to do anything but hurt us. I don't know if this stage is going to be a real battle given that it's 3ds and we almost certainly aren't really going to use 3ds for practical reasons (we'll have to see what the connectivity stuff actually is I suppose), but there could be a stage like it on Wii U which is why I'm making a point of this now.