I think he will go up, then down. but not further down than where he is at the moment. I can imagine him becoming more popular since hes actually quite good when played properly, but yeah his playstyle does seem overly dependant on bananas. I dont see him being as much fun to play as many other high tier characters, while still not being good enough such that people looking for a high-tier character would main him, over marth for example.
That may be true for some of the Diddy players you've seen/watched.
But, we might be treading on possible (lack of) player skill and/or development then.
For example, many IC players are all "lolyayicanchaingrab!", but have no clue on how to use desynchs well, or fight too well outside of grabs.
Some Sonic players are all "omgspindashcancelspindashcancelspindashcancel", but are lacking in uh... tilt... and basic gameplay usage of stuff.
In the Diddy case, we might be looking for an example of a player that isn't necessarily banana-dependent, but can pull off banana moves effectively (or the other way around - awesome with and without bananas).
In the IC case, we might be looking for examples of players that can desynch and fight that way, but use a x-death CG when applicable.
In the Sonic case, we need a marriage of 'basic' gameplay and 'AT' usage.