(edit: posted while the item debate was going on)
Oh boy, this thread became another items vs. no items...
It's not as if the items and stages were the only problems with the tournaments were the only things that could be considered poor choices with this ruleset. What about these ideas?
1) Lengthen matches by increasing stock and time limit
Sure, it may make the matches last longer, but in a way it could partially negate the unfair KOs caused by cheap items and stage hazards. Let's ponder for a moment: we have 2 players that have a somewhat noticeable difference in skill where P1 is a veteran competative smasher (not necessarily a pro) and P2, though her/she knows the ropes and knows a trick or two but has not played in as many tourneys as P1 and generally would not be considered better than them. 5 stock would be fine in determining the better of the two without items (since the KOs would take long longer with just attacks), but not with, as any stocks lost due to items or hazards would be too difficult to make up. For example, P1 has 3 stock plus 64% and P2 has 2 stock and 119% damage but a golden hammer spawns by P2. Save for it being a squeaky one (and P2 not sucking), P2 could knock one or two stocks off P1 (heck, even 3 if P2 was lucky), putting P1 at a massive disadvantage (especially if P1 racked up a substantial amount of damage when hit by the hammer but not KO'ed). Even if P1 could KO P2 once more before the match ended, P2 could still finish P1 during their invincibilty frames after getting off the recovery platform or a least land a few good blows in before it expires or just play defensively 'till the end of the match (if he/she still has 2 stock). Granted that P1 could still turn the match around, but the disadvantage would be equivalent to bringing a knife to a gunfight. Now, let's say that instead of starting with 5 stock and 7 minutes, they both had 10 stock and 30 minutes to play. If the scenario played out the same way as previously described, P1 would still be at a disadvantage, but he/she would still have plenty of stock and time to turn things around. In fact, if P1 lucked out, they could end up with a smash ball or something to that effect and [almost] completely flip the match back in their favor. The stocks will go like crazy with some of these items on anyway, and with the increased stock, more opportunities will arise where people will be able to develop item-related strategies in brawl (be it using or avoiding). Remember, luck is like oil: some people may have more of it, but it will run out eventually, and having more stocks will minimize the influence luck has on tournament outcomes. At least, that's what I speculate.
2) Low item spawns, but not off
Let's say while P1 is flying into the backround after being hit with a golden hammer, a smash ball appears by P2. P2 (obviously) gets it and can do a FS as soon as the GH wears off. In theory, if P2 uses items to keep P1 away, P2 could keep getting all the items while P1 is recovering, leading to total match domination by P2 no matter what P1 does. The solution? Minimize item spawns at times where only one player can grab an item. The only way to do that is to lower the spawn frequency itself, which leads to having one or two items on-stage at a time. There's a difference between no chance and little chance of grawbbing an item that appeared, and a big one at that. If P1 is close to P2 during the spawn while P2 doesn't have an item, P1 could nab the item before P2 even before P2 notices it's there! Keeping items on low could make matches unpredictable without making them one-sided.
Let's start with that, since items don't seem to be going anywhere. (waits to be proven wrong/flamed)