As previously mentioned, Roy was primarily put in Smash to promote the newest unreleased Fire Emblem. FE hadn't come to the states yet, so they included Marth. Marth was already slated to be in the game, but I recall hearing something that Roy and Ganondorf were both really close to not being in the game due to time constraints.
The idea was to make Marth the speedy, combo-character and Roy his slower, more powerful opposite.
As I know from playing with Roy for the better part of five years, they failed in this aspect.
Truth is, Roy is weaker, lighter and slower than his blue haired ancestor. All these things contribute handily to Roy's low-tier ranking. More than any other doppleganger couple in the game (Mario and Doc, Pikachu and Pichu ect.) Roy and Marth are the furthest apart in terms of rank. Roy isn't a terrible character by any means, but they could have set out to make him better. Easily. And here's a few suggestions.
First off, the primary focus of Roy is that Roy is supposed to be more powerful than Marth. Sweetspots taken into account, this flat out isn't true. Sweet Spotted Marth not only pushes further, but causes more damage than Roy. One easy suggestion is to simply make Roy more powerful. Not just by a little bit, but by a small chunk. This'd make up for his lack of speed as well as priority. And if we're fixing damage, his Priority should be increased as well.
Second, while physically speaking, Roy's Blade of Seals may be longer than Marth's Flachion, there's no question which tip of which sword you'll be trying to hit with. While hitting with Marth's non-sweet spotted sword is perfectly acceptable, non-sweetspotting Roy's sword is horrible. To compensate for this, I think that his whole sword except maybe the last 5% should be sweetspot territory.
Third, If Roy is to be slower then he should benefit from a weight increase. As it stands, Marth can absorb more damage and live than Roy can. He should be a good deal heavier to help him prolong his fights.
Here's an interesting fourth point. Damage-wise, Roy and Marth are fairly similar on the ground, but in the air, Marth is far the superior. He can combo across the stage into spikes or other debilitating moves. Roy's air-game is absolutely pathetic. The best he can pull of are short-hopped combos into one of his three primary killing moves. (Those being F-smash, his Blade Dance Combo and his Flare Blade) And even this isn't reliable as his chaining Air moves (N-air, F-air and U-air) are not universal in the least. They only work on medium/fast fallers. If Roy is supposed to be the power hitting equivalent of Marth, He should have either a huge damage increase to his air game, or a different move set with power moves similar (but perhaps not as powerful as) Gannondorf.
One reason for his low rank (And the fifth point in this post) is because Roy has no advantages over any other character in the game. In fact, he seems to only have fights he should totally avoid. Peach, Jigglypuff, Samus and DK all seem to give Roy a serious problem. Almost all the other characters have various match-ups with varying degrees of difficulty. The reason for these four insanely difficult fights for Roy is because Roy's killing moves all hit you in the same direction: Horizontally. And those four characters all excel at recovering horiziontally. All Top-tier people have various directions they kill people with, so I think that Roy should get a move that kills over the top. As it stands, Roy's Up-tilt is ****-near useless, Up-smash is not a great move (but it is better than Marth's amazingly) and his Up-throw isn't too terrible. But a move that kills upwards would be awesome.
The sixth and last point I'm going to make here has things to do with the mechanics of Roy; how he performs in the game. Whlie his current state isn't bad, he has little weird mechanics that get in his way. The timer for his counter varies (How long it takes him to get into counter-stance. I don't know if it's something I'm doing wrong, but occaisionally it seems it takes longer to get into his counter-stance and that extra half-second gets me hit), a slow-get up edge-hog almost always certifies Roy's (and Marth's) deaths. If a character is to o close to Roy, he cannot hit them. My friend plays an excellent Marth and when we fight with our Mains, occaisionally we'll throw grabs through one another. Phantom's also effect Roy almost as equally as Marth. Lastly, using the first part of Blade Dance to come back will occaisionally send Roy downwards instead of over, also killing him...
These are just a few points I think would make Roy a much, much better character. I certainly hope he's in Brawl, but I seriously doubt him, or Marth for that matter, will be in the game. Only time will tell I guess.