I can't say it's that bad but besides the obvious Battle mode issues, there is at least one other additional complaint that OP touched on, and it's the item system. The real reason behind it is, however, because item probabilities are not just based on race position, but also on distance from the leader. This means that, once one person breaks away from the pack, usually due to getting the luckiest at the first set of items + some good driving, they can stay there nearly forever because the players far behind that are in the pack will always be getting powerful items and screwing each other over while the first player continues to increase their lead. The only item that can really shake this up is the blue shell, due to it having a much greater influence on 1st place than anything else.
I'm guessing the system was implemented so that bigger leads could be shortened more easily, but in practice it ends up doing the exact opposite.
Also if any game had tracks that were bland and too wide it's Mario Kart 64. Many of them were also way too long, like Wario Stadium and Rainbow Road.