since ike is slow and Lag makes it more slow, it must be horrible...
It depends mostly on your own playstyle, but I actually think it might be a bit harder to play as fast characters. If you use a slow character, you can still do well in a match as long as you have good timing.
I usually only experience lag when I'm active. If I don't press or hold anything, most of the time there doesn't seem to be any lag at all.
When I use slow characters, I might be able to rely on their weight or power, which makes lag not too much of an issue. Assuming that lag is the same for everyone else, the problem with using fast characters is that lag can keep you from using their speed, which forces you to play as if you were using a slow character. Lag can also make certain combos a lot harder to pull off, depending on how bad it is.
What I find most annoying, with any character, is how hard it can be to recover. (especially when using Luigi's cyclone, which requires continuous button pressing).