Zelda does not work because all her movement options are taken away.
It should not be: Zelda is slow and strong and Sheik is fast and weak.
It should be: Zelda is good at solid knockout attacks and Sheik is good at racking up damage.
Sheik is designed perfectly in Brawl. She is great at racking up damage.
Now how do we fix Zelda?
1. Take away her multiple hitboxes (at least for her finishers). One solid hitbox for her attacks.
2. Give her movement options. Smash is a game about movement. You cannot give a character bad rolls, dodges, land speed, air speed, acceleration, blahblahblah and expect them to not be horrible.
3. Make the switch between characters also an attack.
Those changes alone will make her perform how she should.