This doesn't seem to have really enough information to be it's own thread, especially since it was named "The Art of Paralysis" (suggests this would be a guide). I suggest posting here ---->
http://smashboards.com/threads/sheik-general-discussion-social-narutos-little-sister.324217/
I wouldn't say that the third option is underrated, just that the other two are very central to Sheik's neutral game and important to everything she does, while this is situational and don't perform the role needles are supposed to. Her default needles, when used with a tech called Rising Storm, offers great kill options off stage (where Sheik is strongest). I'm not entirely familiar with her second needle option, but I do know that it does great shield damage and charges much faster, which is amazing. Her third option, although good for getting kills, requires the opponent to get hit by her needle, which won't happen too often in top level play. Her Stun Needles aren't bad, they are just too situational and not as good as the other options. If needles weren't such an important part of Sheik's game, then her Stun Needles would be a smart option.