Hmm, flamebait topic.
I'm not sure about that. The concept itself seems fair enough, but on the other hand, it just seems wrong. You can already beat a Fox with Mewtwo, for instance. There are some who may take pride in mastering a lower tier character...
Or something. I'm not sure why, but it just seems wrong.
But even still, handicap would have to be better in the first place for that to happen.
As it is, handicap has a weird effect on knockback and stun time and so on.
A Bowser with higher handicap can insta-kill floaties with his Koopa Klaw forward throw on many stages, given that the handicap is high enough. The same goes for the Fortress, which is his fastest move.
Luigi suddenly turns broken as well as his fair gains tremendous knockback even at 0% and with the reduced stun time in the air, comboing him is nigh impossible.
It just wouldn't work.