This is a debate that is always up in the air, if you want to play items good for you but playing with all of them adds a random factor that can hinder you more than helping, say you air dodge grab a capsule and go to throw it at an enemy, suddenly an explosive box drops from a spawn point close enough for it to explode and kill you. How is that a strategic ko for the opponent?
There was an official item legality thread somewhere on SWF. It eliminated all the dangerous items.
Not a bad choice, he's short, fast, and has a good bit of power too. I find him to be one of the hardest characters to beat when I play Marth. A lot of my game with Marth is played on short hops and in the air. Diddykong's combination of size, strength, and speed make it a bit difficult managing the fight. Not to mention he seems to have good priority and more reach than you'd expect.