This is extremly true, and you can't really do anything about it when you start getting comboed since there isn't any DI in SSB64 (apart from smash DI, which can't do much in most cases). You can influence the outcome of a chaingrab (you can di to try to make your opponent mess up, or di away from a part of the stage that you wouldnt like to be etc) in melee more then you can influence the outcome of a normal combo SSB64. Once you start getting comboed in SSB64, you can basically put down the controller and wait to die.

Comboing others also gets less interesting in ssb64 because of this, because you can basically do the same combo over and over. (not entirely though, since it stage dependant, but to some degree you actually can)
The lack of DI is SSB64's biggest flaw imo.
I completely disagree with ssb64 being "all offense" though. You need to get that first in hit after all, remember? There is lots of dancing around, spacing, baiting, punishing and arial priority wars in SSB64 before anyone gets that first hit in. The only factor here that is extremly different from melee is the lack of a useful shield, since the shieldhitstun in SSB64 was so big. You could basically break shields with kirby's uptilt lol. But this isn't really a minus imo, it's not a bait/punishment is impossible, it just means that you always need to rely on your spacing and never have the option to "trick" your opponent into a shieldgrab (which you have in melee). It's just something that's different about the game.
I agree that SSB64 is more balanced then melee (and off course Brawl)
Regarding which one of them is the best competitive game I don't really know, I'd probably say it's an opinion thing. I prefer melee though.
Both games are amazing, regardless.