The effectiveness of customs Villager planking is the only reason CaptAwesum made Top 32. The only reason. This coming from someone from Tristate who wants the best for their region and their players to succeed (CaptAwesum is from CT). He had no shot at beating Rain or K9 without customs on. He wouldn't have come even close to beating Larry Lurr with customs off, in fact the only reason Larry Lurr even win was because he was able to reverse time him out. In losers he ran into the Villager ditto, which he straight up lost. This is a player that can't even win his own locals. I think this is actually a pretty notable instance of customs transcending skill. Rain? Sure, chalk it up to matchup inexperience. That's a ruleset incompatibilit because there are no customs Villagers in Japan as they don't play customs, so how exactly was he supposed to practice? Looking at a video and applying information in practice are two very different things. However, if this strategy really is so beatable, you would think that the best player in Japan would be able to adapt and beat this one the fly, no? K9's brother plays Villager, so you had best be sure that he has Villager practice. Larry Lurr was this close to losing a set in R1 of Top 32 bracket in a matchup I'm sure he's prepared for. I think these players are being underestimated in their preparation because no one in their right mind would ignore customs Villager when preparing for EVO. Even considering that it's beatable, customs Villager promotes degenerate play that is devastatingly effective and makes timeouts (and reverse timeouts) more common/optimal. The hypest thing that happened with CaptAwesum was getting reverse timed out by Larry Lurr. He upset two players of a higher caliber, so shouldn't there have been excitement? This degenerate play is bad for spectators AND the metagame.
Another main offender of degenerate play and transcending skill barriers was customs Sonic (HSD, double spring, gravitational Down B). StaticManny puts Dabuz into losers in pools without customs? StaticManny eliminates MVD without customs? Just watch those matches. It's so clear that customs buff Sonic and bring the effectiveness of his camping to another level entirely. HSD puts so much reward on landing spin dash, it's kinda insane. Not only that, the hop at the beginning gives Sonic even more trajectories at which he can jump out and makes him harder to catch. What is Sonic's big flaw in general? Landing. Double spring pretty much invalidates this because he can mix up his landing in so many different ways. With the Gravitational Charge, it's almost like he has normal spin dash as well. The custom moves are why StaticManny was able to camp so much more effectively and pull off these huge upsets. The best proof of this is when StaticManny initially went default against FOW, lost a game, and then switched to his customs and almost took back the set by winning one game and getting down to last hit in game 3. Customs improve Sonic's keep away game drastically, to levels that are unhealthy and bordering degenerate.
I also think we really got to see why Pikachu's customs are ridiculous. Abadango preyed on matchup inexperience and Mario seemed to be a rough matchup, but it was really clear that ESAM's results were artificially boosted due to customs. He could be behind by a lot, but one Thunder Wave connects and that's it. He would have lost to Regi, the no-name G&W from Mexico, without customs. Look at the set, you can't tell me that isn't true. Pikachu's infinite is not only practical but able to be used devastatingly. It's clearly a problem and not something that's healthy for the game.
On the flip side, what exactly did customs help? By this I mean, what results did customs pull for these worse characters that supposedly get so much viable with customs? There was one Mii Brawler, one Palutena, and two Wii Fit Trainers. Mii Brawler and Palutena both have broken custom moves (Hurricane Kick and Lightweight). The only reason they're made that much more viable is because they have those broken moves. Just look at the current implementation of these moves. They aren't healthy moves for any character! You can combo into Hurricane Kick and kill stupidly early. No, not like Boost Kick early, like 50% early. Lightweight's current implementation is broken. You can use it infinitely for free, with pretty much no relevant drawbacks to something that gives Palutena the best mobility in the game. Grab = death starting at like 80%. It'd be fine without infinite Lightweight, but we can't count on that being patched out for the time being. I'm not going to take two characters who have broken moves as a positive for customs. The Wii Fits...I think it's overestimated how much of a benefit customs provide in that case, and they both lost pretty quickly in bracket. Between custom Sonic, custom Pikachu, custom Villager, custom Diddy Up B, and Mii Brawler Hurricane Kick, customs had a greater negative effect than positive effect on the tournament.
Here's the thing: more viable is irrelevant when most of these characters that get better with customs still aren't really tournament viable. More viable is an arbitrary metric that ignores the fact that, in the cast of most characters, customs are not enough to fix their fundamental flaws and truly allow them to compete. I'm wholly unconvinced that the supposed diversity that is supposed to come with customs actually exists. This is the only positive element of custom moves and they completely failed this test.
Could we just ban specific moves? We could. However, based on the fact that it's a logistical nightmare in itself to have customs and a negative overall effect with problematic moves (that applies to multiple characters), it just doesn't make sense to have them.