It bears mentioning that Nintendo put out a Balloon Fight game starring Tingle for Club Nintendo members a few years ago.
Gameplay for proof.
Tingle's Balloon Fight is the reason why I think Tingle would make a better Balloon Fighter than the generic Balloon Fighter. At least he wouldn't be useless if his balloons popped. Here's some ideas I borrowed from the Tingle Tuner item in The Legend of Zelda: The Wind Waker.
B: Tingle Bomb
If used on the ground, Tingle just places a bomb on the spot he is standing on. If used in the air, Tingle drops a bomb straight down. This is loosely inspired by the Super Bomb in The Legend of Zelda: A Link to the Past.
Side B: Tingle Shield
Tingle raises a shield like Nayru's Love while launching himself across the air like Luigi's Side B move. This would allow Tingle to zoom across the air while deflecting projectiles/attacks and attacking them. This is loosely inspired by that move M. Bison makes when he set himself on fire and fly across the stage in the Street Fighter games.
Up B: Tingle Balloon
Tingle inflates his balloon and starts to fly around with it. It is like Pit's Up B move. Press B while flying and Tingle will drop the bombs like a bomber plane.
Down B: Tingle Watch
Tingle wears a pendant with a watch attached to it. This special move creates a small force field that surrounds Tingle. Tingle is flashing in many colors while the force field follows Tingle. Anyone who enters inside the force field are slowed down by time, allowing Tingle to beat them up. This is loosely inspired by the Clock item in the original Zelda NES game.
Final Smash: Kooloo-Limpah
Tingle does his Kooloo-Limpah dance and then starts to fly around with his balloon and shoots enemies with Rupees. The Rupees are shot rapidly from his hands like a machine gun. It controls like Diddy Kong's Final Smash but you must hold down the B button if you want to shoot Rupees constantly. This is based on what Tingle did in the final boss fight against Uncle Rupee in Tingle's Rupeeland.
As for his A moves, I think he could fight similar to Jigglypuff, floating with his balloon and doing his variation of Wall of Pain.