Sweet tooth's level one makes up for the lack of strength in the level two. if you get lucky you could get three kills with a lvl 1.
I was in an online 2v2 stock limit match. me (sweet tooth) and cole vs sly and big daddy. after playin a while cole and big daddy died so it was me vs sly! it was the locorocca stage. we both had 1 kill left and the sly was an idiot cause he kept on tryin to use his level 1 but i could'nt use my level 1 either even with the setups cause sly was alwayz jumpin around so i got my level 2 and BOOM. killed him easily. his level 2 is best on 1v1. hope i helped a little.
Just saying that sweet tooth actually has dozens of more ways to combo into his level 2 compared to his 1 and he can detonate it by pressing any attack button while it's flying so it's far from useless.
If it cost less we would spend less time with a lvl1 readied and couldn't stack as many lvl1's. I wish it cost more! As long as the lvl3 cost didn't increase.