Ok, so the more I think about it, the more I like my idea. I think 'First to X number of kills' is way more fair for online than Time or Stock. It forces you to have to fight, and not get a lucky kill or two and run away.
First to X number of kills explains why we don't see stock or don't see a timer in the online footage as well.
It could also be easily tweaked for modes. First to 3 kills in 1v1 glory, first to 5 kills in 4-player glory, first to 7 kills in For Fun (due to items/final smashes). It prevents really cheap strategies and forces you to HAVE to attack your opponent and not run away. I like it a lot.
Still doesn't fix the 'final destination only' making some characters better than others.
What's the difference from timed? Even if you do whale on a guy, someone could just as easily run up and steal your kill. Whoever gets the kill still gets credit for it. Stock (with a timer perhaps) is still the way it should be done.