I'd say the blue shell should at most be like one of Samus' missiles, just a bit faster and a bigger blast (exploding container), certainly not some magic bullet that will hit with absolute certainity unless the other guy spent hours practicing defense. That goes both against the "fun for everybody" mentality of SSB (since only a veteran could avoid it) and the "no cheap hits" (everything can be avoided, especially the super powerful stuff) rule that ANY multiplayer game must follow (I'm looking at you, Mario Kart!). Games need no "great equalizer" because games should be a test of player wit and skill, not who has the least equalizers used against him. I really consider Mario Kart DD unplayable above 100cc because of the blue shell, there is no way to avoid it and that makes the game a pure test of luck. I don't play games for luck, I could just as well roll a die.
What I WOULD like are boobytrap items that look almost like normal items (slightly different but close enough that you might overlook it in the heat of the battle, perhaps a little timer-like thingy somewhere on the item) but explode when you try to use them (power obviously proportional to item power). Whereby "use" should be an actual atack with weapon-type items. Would be hilarious to see someone pick up a Super Scope, charge up his shot and explode.