You know, if you think about it, Dark Pit actually KOs much faster than Pit because of Electroshock Arm's horizontal knockback compared to Pit's Upperdash Arm, which is terrible for high ceiling stages like Skyloft. Electroshock Arm, at the edge of a stage, is just perfect for KO opportunities, something Pit severely lacks in his own attack.
While Pit has his weaker, yet more controllable and faster arrows, Dark Pit still has not only the power, but also the Electroshock Arm having better KO capability than Upperdash Arm would ever. Otherwise, they are essentially the same character, but I believe Dark Pit is not a half tier lower than Pit, but I believe Dark Pit is just one spot above Pit, only because of Electroshock Arm's capability to KO faster than Upperdash Arm, especially on stages with higher ceilings and closer blast lines such as Final Destination, Battlefield and Smashville; it is much more effective on Smashville no less since it has the closest side blast zone.
And with customs on, Dark Pit's arrow issue is remedied obviously since he'll have more control with his arrows, which would just actually make him half a tier higher, in theory, than a customs Pit.
That's good in theory, but it doesn't work that way.
Arms are incredibly situational. I mean super situational. People get this notion into their heads that the moves are safe because they're both fast and can plow through opponents with super armour, but...they really aren't. They're slow and the armour is spotty at the best of times. If you shield it, that's a free punish. Serve a projectile at it and the move intercepts itself - Mario's fireball can cut it short. You can even grab the Pits in the middle of the animation. It's best to think of it as a counter more than anything: you either need a hard read or a good crossover for it to work.
With that in mind, it isn't as simple as "Dark Pit wins because he can setup for KO opportunities". Pit isn't short of off-stage setups: he has a great dash grab that converts into f-throw, which itself is infinitely more effective a setup than Electroshock Arm. Nine times out of ten, if you can get Electroshock in at the edge, f-throw is a better, safer, more reliable and more efficient option. Dark Pit
can KO off the edge
if the stage has narrow blastzones
and he's at the edge
and he has an opening
and the opponent is at a high enough percent to get caught off the edge. That's a big commitment and an incredible depth of theory. At the same percents Dark Pit needs to kill with Electroshock at the edge, he can kill with f-throw or, at the very least, get the opponent far enough away that he can just chase them.
You fundamentally overestimate the efficacy of Upperdash Arm in the first place. Pit doesn't fish for kills with it unless he's desperate or so far ahead in his stock that it doesn't even matter if he misses a few times. Otherwise, Pit doesn't possess a dearth of kill options: f-throw at the edge will kill at high percents, f-smash will kill with a good read, tipper f-tilt can kill, even u-throw can kill if the opponent's at KO percents. He doesn't need to use Upperdash. It's there as a contingency in case everything else doesn't work or he wants to style.
Pit's arrows are much more versatile than Dark Pit's in the first place. Said it before, say it again: even if Dark Pit's are stronger, the fact that you can control Pit's means you'll hit more often with them and therefore do more damage in the macro scheme.
tl;dr - Dark Pit isn't any higher because his differences don't justify any big change in his placement. For the use his differences even have, he's fundamentally the same.