EDIT: And forgot he halves Fire!
I didn't forget this, and didn't feel the need to state that her next best after that wasn't enough, as it felt pretty obvious.
And...yeah, not even thinking about the MP damage arguments myself, as Terra has other problems if she tries for a chipping game(like Luther getting doubles on her). This just feels like a case of "Terra vs a limit boss who's faster then her and resists her best damage" and such, for me. Chip->Smash through limit doesn't work because he resists her Smash, and stalling games don't work because he will double her, and sooner rather then later.
EDIT: And now for something I DID forget, what level does Terra learn Pearl?