So for the most part, I'm going to try and keep what I say as "on paper" as possible (Not counting playstyles, just what does what). Afterwards, I'll elaborate with my own personal bias and experience on whatever I'm talking about.
So the most important, elaborate part about Sheik dittos is the neutral game.
No it's not about whoever does the craziest combos.
No it's not about whoever can net the kill first.
If you lose the neutral game, you'll most likely lose the ditto.
This doesn't go to say that if you're currently losing the neutral, then you'll lose the game. It's ALWAYS possible to bring it back in a Sheik ditto. As long as you adapt accordingly, you can begin to win the neutral and snowball that in to winning the game. There are a couple of important aspects to the neutral that I would say makes the biggest difference in Sheik dittos:
What % I'm at, What % My opponent is at & who has full charges of needles.
The reasoning behind this is when you're both at low %, you can both combo each other really hard. When one person is at high %, they are at threat of dying, but they have rage meaning they both lose combos & can kill the other Sheik easier. The factor of Needles forces the other Sheik to approach the one with needles because they don't want to eat a free 10%. Needles also gives Sheik a kill setup when edge guarding so that's another strength needles gives.
^ From my experiences having fully charged needles is free % because you can keep it to punish a landing. It also gives you a safe follow up and forces any Sheik to recover low if they're at kill %. If they don't / they bouncing fish to the ledge punish it with Full hop Needles > Bouncing Fish.
IMPORTANT: A big thing to notice is what Sheik is approaching and what Sheik is reacting. The reacting Sheik will usually have the upper hand, unless the approaching Sheik repeatedly wins the neutral. Probably like 55-45 Reacting Sheik's Favor.
With that out of the way let's explain how the neutral game works in this matchup.
Things to note & watch out for / things to exploit and use
Tomahawk, Dash grab, Shield out of dash / Dash shielding (idk the term LOL), Fair oos, Nair oos, and Fair
Tomahawks are used to condition your opponent to stop shielding meaning your fairs will work more often than not.
Same thing goes for dash grabs. Getting a raw grab seems impossible, but Sheik has such high mobility in simply the way she moves meaning these work very effectively. After getting a grab you can do the usual f throw bouncing fish. Going for a raw grab is risky though since you can just hit confirm into grab, so watch out.
Fair & Nair oos are used to combat Fair & tomahawks. Used in conjunction with dash shielding, this is a very easy way to react to an opponent trying to do something to you. Fair oos has followups, but you are stuck in fair animation for a long time so dont miss. Nair oos has virtually no followups but starts 2 frames earlier and has a wider hitbox inside of Sheik making it a better defensive tool.
Sheik's Fair is probably what makes this matchup so in depth & knowing how to beat it and use it is very important. The reasoning behind this is fair leads to grab. Fair is also a very difficult move to beat due to it's spacing. If a Sheik starts jumping, it's likely she'll go for the fair. The ways to stop this are either shield the fair and punish accordingly, or hit sheik before the fair comes out. Both of these options are difficult due to the fact that if you shield drop to punish the fair, the other sheik can fair you first and get a followup off of that. If you sit in shield waiting for the fair, the sheik can tomahawk and get a grab, leading to a follow up. It's all about conditioning and what you think the opponent will do to you.
A lot of people say Smash is just high paced Rock Paper Scissors. Sheik dittos are the exact same way.
Sorry if I feel like I'm only explaining what the opponent can do to you/what you can do to the opponent for certain situations, because it does work both ways and I'm hoping you can see it that way too.
After the neutral game comes the combo/punish game, and ways to kill. I'll cover the combo game first since this will kind of be in chronological order of how a stock flows.
So there's your stereotypical combos of: Fair > Bouncing Fish, F throw > Bouncing Fish, Fair > Grab, F Tilt > Grab for majority of the %, F tilt > Nair, Fair > Bouncing Fish around mid %, then kill setups at later %. Learning these and not missing these are important. The more you can get out of a small amount of combo opportunities is very important.
In the ditto specifically, one of your best low % combos will be Fair > Grab > F Throw > REACT TO DI
If the DI in : > Fair, Fair, Fair > Regrab > F throw > Bouncing Fish
If they Di Away: >Fair, Fair, Regrab > F throw > Bouncing Fish.
Sheik's combos are what swings momentum in one Sheik's favor. Winning the neutral game gives Sheik combo opportunities. Knowing how to optimize with less combos means you have to win the neutral game less times to get the opponent to kill %s. Learn your combos, but focus on the neutral game first.
Lastly is killing with Sheik. A lot of people say that the Sheik that takes the first stock is very far ahead of the other Sheik, I don't really agree if the other Sheik is in kill percentage. Spawning in gives you free stage control and you can very easily snowball that into killing the other Sheik. I also don't think that the Sheik with the higher % is necessarily "behind." Being at higher % means you lose combos, but you probably have more combos than the person you're facing and you can use those combos to get stage control and net a kill on the opponent.
The obvious way to kill with Sheik is D throw > Uair. Down throw is an absurdly good move and forces your opponent to either airdodge or do nothing and either of these can lose to a correctly timed Uair. You can probably watch some high level Sheik games and learn how to use this to your advantage. Explaining it is difficult :\ This will also work with F tilt / Tipper D Tilt (Sweet Spot / the toes/feet not her leg).
The next way is FH Needles > Bouncing Fish. Hit this on an opponent recovering and they're most likely dead. That's about it in this department.
The crazier way to fight a Sheik and kill is punishing a Nair / an airdodge with an Up Smash. During Up Smash, Sheik's hands and her head become invincible meaning it is impossible to trade with this move from above. If you put a Sheik in that situation and they Nair/Airdodge, Up smash can kill as early as 80% with a good amount of rage on you.
All of these kill setups are good, and of course there's more, but I think it's easier to learn them on your own from watching a video / personal experience. But like I said before, kill setups come after combos. Combos come after the Neutral game. If your neutral game is amazing, you have a good chance at winning the ditto. You can ALWAYS work on your neutral game.
Neutral game being: Spacing on Fair, what options you choose, how you recover, how you regain stage control, how you abuse your own stage control.
Don't worry about if you win a match or if you lose a match, think about what lead to what. The more you think about your matches, the more you can learn about how to improve. Always ask what could you have done better.
I wrote this with the intention of being easy to understand, so if you're confused on something or want me to elaborate on something just ask.
Note: Reaction speed plays a huge role in both the ditto and playing Sheik, so try to work on that.
