If the Bayonetta character is so overpowered that no other character can compete against it, which is why the decision was made, then it is not fair on the other players as anyone who has trained using any character other than Bayonetta. The only way to beat someone playing Bayonetta would be to also play as Bayonetta, which would ruin the game as every game would just be Bayonetta vs Bayonetta and that would just make the audience stop watching the matches all together.
I believe that Bayonetta is not "so overpowered that no other character can compete against it." Bayonetta has a very strong combo game, but she has several flaws. First, Bayonetta is in the featherweight class, at a weight of 84. [source 1] Secondly, she actually has quite poor frame data. You can find more at source 2, but simply put, all of her moves have a lot of lag, most notably her smashes, all ranging from 43-51 frames of endlag, and Bullet Climax, with over a second of lag uncharged. Simply put, a character should be banned if they have no flaws, and Bayonetta does not fall into this category.