It crashed the server for no apparent reason, and since it has no competitive use in singles, it was simpler to disable its code ban it.
About your other questions, I would like to keep this new metagame similar enough to standard, so that people don't have to "learn two pokémons". It's not about making Outrage as good of Fire Blast, but make it play like standard Outrage, which basically forces you to switch or sacc your dragon unless you used a specific item (lum berry/white herb). A weakened steel should still be 2HKO'ed by Outrage but save the game by activating its side effect. Seed Flare traded its nice side effect for some accuracy, and Power Whip is a temporary double standard in favor of Ferrothorn, as he keeps a lot of threats at bay and I don't want to risk messing up the metagame too much.
All of these are obviously first drafts, and some will probably be changed after more playtesting.