Just having a few nods to the item's effects in her moveset wouldn't hurt. I really think the concept of her being "powered up" by her item is a fun and unique idea, and I'd love to see what the Smash development team might do with it.
I agree. The stick itself would be cool, but I also think we should take the "Duck Hunt" approach to it. Duck Hunt's Smash Attacks are just some off-screen player shooting at him (or the duck on his back). For Lip, we can focus on both. A mechanic that focus on Lip "getting stronger" and a moveset that avoids using Lip's stick too much.
Lip's standard attacks can be the normal stuff you'd expect. Inking throws out punches and kicks and Villager takes out boxing gloves. Some characters are closer to their source material with standard attacks (Megaman) than others (Sonic). For Tilt Attacks, if we don't improvise, then having Lip use her stick here wouldn't be a bad idea. It would be like Ness using a Forward Smash when he has a Home-Run Bat. It wouldn't change much as long as their normal attack isn't as good or effective as the item variation that everyone can use. Plus, if Lip happens to grab the item variation of Lip's stick, it would only replace her standard attack, her Forward Tilt, and her Forward Smash Attack. If it is the lore that we are worried about, then we can give a pass for a number of reasons (just to name a few):
The Moon is an Assist Trophy but Great Bay is selectable in the game (and the Moon appeared as a background effect on that stage).
Toon Link is playable on all stages despite Toon Link being an NPC in one of the in-game Zelda stages (he isn't there if you use Toon Link, iirc)
Mario and Luigi can use fire balls despite the in-game Fire Flower functioning differently.
For everything else, I'll try to avoid including the stick to give Lip's moveset an identity without relying on it.
First, let's give Lip some free Aerial Attacks and Throws that won't require her to use her stick.
Lip's Aerial Attacks and Throws could focus on singular panels, each one appearing near Lip during attacks (think Pac-Man using ghost for Smash Attacks). We could have random panel appear each time, but if we gave each aerial attack and throw a panel, we could go with this method:
Neutral Air (Circle)
Forward Air (Star)
Back Air (Heart)
Up Air (Light Blue Triangle)
Down Air (Dark Blue Triangle)
Throws (Diamond)
I think have those "!" panels appear randomly instead of the other panels would be pretty sweet.
Now on to her unique mechanic... I don't know what to call it, so I'll call it a Panel Gauge. In Panel De Pon, panels slowly fill up the screen. You have the potential of having bigger and better chains and combos with more panels, but you run the risk of losing by filling up your screen. We can use this as a mechanic for Lip in Smash. Basically, Lip can build up panels. By default, Lip is light and quick, but she doesn't do much damage and is easily blown away. The more panels she has, the stronger but weightier she becomes. Long story short, Lip loses mobility as she gains power, just like a player gain more options but risk losing a match in PdP by having a full screen.
To keep things from getting too complicated, we won't be focusing on building actual chains and combos like in PdP. Just having any normal panels will be good enough. Landing attacks (excluding Smash Attacks and Special Attacks) will count as "building a chain", thus adding a point to the Panel Gauge. Lip can gain up to a limited number of panels (let's settle on six). If Lip takes damage (and she flinches), a garbage panel is throw in the Panel Gauge. So let's say Lip hits the enemy four times, but she takes damage afterwards. Lip will only have the effects of a "chain of 4" panels, but the weight of a "chain of 5" panels because of the garbage panel. We don't want to be stuck with a sluggish Lip throughout the whole fight, so this is where Smash Attacks and Special Attacks come into play.
Let's start with Smash Attacks.
Smash Attacks could focus on completing combos. The more normal panels Lip has, the "higher the combo" will be, giving her more range and power (maybe with the exception of the Down Smash). This won't remove panels, so it plays a role in having more reach and power in exchange for movement:
Forward Smash: A row of panels.
Up Smash: A column of panels.
Down Smash: A small row of panels on both sides.
To remove panels, we need to move on to the Special Attacks, namely Up Special and Down Special.
Her Neutral Special could be another way to gain panels. In PdP, you can speed things up by filling your screen with more panels. In this case, Lip could slowly get panels by charging with Neutral Special. This is useful if your opponent isn't making any attempts to approach you.
Her Side Special could be similar to the cursor swapping around panels. In this case, Lip and her opponent would swap places, making for some interesting moments when fighting off-stage. Swapping around panels to make them fall down is one part of PdP, so having this as an ability wouldn't be too far-fetched. During the swap, the enemy doesn't turn around like with Mario's cape, otherwise Lip would be eating charged Forward Smashes all day. Having it only be used once while in the air sounds reasonable. Adding free fall to Lip and her opponent sounds broken if positioned right, but I guess adding Lip to the "-cide" list with Kirby, Bowser, Ganon, and the like wouldn't too bad.
Her Up Special could be a garbage block. It could appear above and slightly ahead of her when she's on the ground and directly below her when she's in the air. The garbage block lingers in the air for a bit before crashing down, similar to how they work when building chains and combos in PdP. When used in the air, Lip will jump off of the garbage block to get some extra height. The garbage block could grow in size too, just like in PdP. The size of the garbage block is influenced by the number of panels you have, and once used, all of your panels are gone.
Her Down Special could absorb damage. The idea is kinda like making panels out of garbage blocks. Your opponent has to hit you with chains and combos before you can break down a garbage block they send your way in PdP. Here, Lip would absorb the hit similar to Kirby's Down Special or a counter and turn the garbage panels she previously had into normal panels. It's a way of coming back, just like converting garbage blocks into panels.
And while I'm editing this, Lip's Final Smash. Having Cordelia come in to help out sounds pretty sweet, but remember Master Hand's attack In Smash 4? The one where he throws out yellow platforms that rise to the top? I think that would work nicely for Lip if she had a non-cinematic Final Smash. A bunch of panels rising upwards and the opponents has to prevent themselves from being taking to the top of the screen. Of course, stages like Temple exist, so here's a different idea. In PdP, when the match is over, bricks come from the bottom of the screen and shoot upwards, filling up the whole screen before showing off the results. Let's go for a cinematic Final Smash:
Lip traps her opponents inside of a screen in Panel De Pon. We get a brief shot of the panels rising quickly with the opponents as they hit the top of the screen. Finally, the bricks sky-rocket upwards, crushing the opponents and ending the Final Smash. It could focus on vertical knockback.
All in all, Lip's Smash Attacks focus on making combos out of panels, Lip's Special Attacks are based on mechanics from Panel De Pon, Lip's Aerial Attacks and Throws uses single panels, and her other attacks can be anything from punching, kicking, slapping, biting, screaming, sleeping, brainstorming, or her stick.
Just an idea of letting Lip gain power overtime without needed her stick.
Sorry for the long post. It's a bad habit. ( •n•)