It's true.
I used Kain on my PSP run of TAY, though, I'm unlikely to field him again so soon, as good as he is.
As for character tiering, this is how I'd personally break it down (note the order within a tier has no significance):
Top tier: Edge, Kain, Ceodore, Palom, Ursula, Golbez
"Project" tier: Rydia, Porom
Mid tier: Yang, Luca, Gekkou, Rosa, Edward, Cecil
Bad tier: Cid, Leonora, Zangetsu, Izayoi, Tsukinowa
Joke tier: Harley, Calca, Brina
A bit of logic follows here. For the most part, everyone in the top tier is a slightly improved variant of someone in either project or mid tier.
Edge, of course, has all his weakness-hitting tricks (with claws, and with a couple elemental katanas even now) from the first game, plus a notably improved ninjutsu list to play with (and yes it is actually sometimes relevant I've found). Throw and Mug are just icing (Mug is nice because as far as I recall it ignores moon phase mods). Yes, by the way, "Smash & Grab" was renamed to simply Mug in the mobile version. Yay for consistency.
Kain is basically "Better Cecil" here; he gets similar power to Cecil with better speed and a better white magic list. Jump also lets him continue hitting hard during full moon.
Ceodore is often considered a "Better Cecil" as well, but I think it may almost be better, sometimes, to consider him to be the white magic equivalent of Golbez. By this I mean that Golbez is essentially a Black Mage who has a limited spell list, but gets the most important spells still (just missing out on the utility magic), but gets a decent physical and durability. Ceodore is much the same, a White Mage with a limited spell list, but still gets most of the important spells (missing Curaja does hurt, but Curaga can do fine with the right gear setup), and still can put out decent physical and is notably more durable than Rosa or Porom. His offense suffers compared to many of the better melees because he doesn't have a way of getting around the full moon damage penalty.
I put Palom in the top tier, but he's as close to a borderliner as this tier gets IMO. He learns Break early, and that matters. For further discourse, see my breakdown on Rydia below. One notable weakness is that he can't get around moon damage penalties on black magic. He does have a minor level deficit, as well.
Ursula is Yang who trades redundant base strength (which can be made up by equips, including the Minerva Bustier which is simply amazing on her) for speed, which is as close to a god stat as FF4 has. Tenketsu lets her continue hitting hard during full moon.
Golbez really needs no explanation.
Rydia can be reasonably described as a project because before you collect at least Leviathan she's strictly worse than Palom (almost entirely because of how early he learns Break). The basic elemental summons are a little better than -aras, it's true, but Palom has Bluff to even that score I'd argue, and while Rydia does have a level advantage it's not a massively commanding one. The top-tier summons give her something Palom can't match (high MT damage at a reasonable speed, since Leviathan and later Bahamut are faster than Meteor), but conversely, Dualcast (if you give it to Palom) gives him something Rydia can't match too. I'd wager that in the long run Palom is a better boss nuker if he gets Dualcast (via dualcasting Flare) while Rydia is a better random sweeper (Leviathan is stronger and less resisted than Quake as far as I know). Also, it must be noted that Summon isn't subject to moon damage modifiers, so this is an advantage she has on Palom as well.
Porom fits in the project tier, in my opinion, because she's strictly better than Rosa if developed (she also has Dualcast potential if you want to send it her way, and Dualcast Holy is almost as good as Dualcast Flare), but Rosa's level advantage can't be ignored. (I don't think Aim really enters into the equation; I can't think of a situation where Rosa has free turns to use it outside of randoms, and I'm not too concerned about my healer's offense in randoms in this game.
Yang, I feel, is really kind of on the borderline between top and mid tier. I placed him in mid because he's clearly worse than Ursula (he doesn't have moonproof offense, his high strength is redundant with much of his gear and his speed is lower), but at the same time, he's clearly better than basically anyone else I placed in mid tier.
Luca is in kind of a weird spot. She's not very good in a vacuum (she's a better Cid, but Cid is quite bad). However, her value goes up substantially in certain party setups due to bands, and Minerva Bustier access patches a lot of her weaknesses (like the speed), and she's a good deal more versatile than most melee characters because she has moonproof offense and she can do (albeit less moonproof) full damage from the back row with Big Throw, enabling oddities like four-melee parties.
Gekkou is likewise in a weird spot. He has better core stats than Luca, but misses the Bustier (obviously), and doesn't have the bands (except with Edge). He still has moonproof offense thanks to his (limited) Throw command, though, and the limitation in his Throw isn't that meaningful (oh no he can't throw non-shuriken).
Rosa... well, if you give Palom Dualcast, then I'd use her over Porom unless you want to rock the twin bands or something. She has a better physical than Porom, but Porom is obviously the better healer provided she gets that Dualcast. Rosa *does* notably have moonproof offense thanks to Aim, but I find in general that you don't want her equipped with bows in boss fights because you really want the extra Spirit from a staff, so the value of it is dubious IMO.
Edward is technically the game's best healer (Economical Ring + X-Potion Salve is nuts) but it drains gil like crazy and he can't do much else. Little else to say.
Finally, Cecil is basically exactly what he was in the first game except useless half the game and with a large level deficit to make up. You could argue he belongs in the project tier, but I reserved that tier for projects who pay off and he doesn't.
Cid is slow and Risk Strike sucks and he doesn't have any real way of patching his speed. That's all there is to say about him. Leonora would have been okay if she learned her black magic about 15 levels earlier across the board, but she doesn't and -aras really don't cut it in endgame. The other three ninjas are some variety of "<Classic FF4 character> but worse" - Zangetsu is a worse (original) Kain, Izayoi is a worse (original) Rosa, and Tsukinowa is a worse (original) Edge. They're usable, but only just.
I shouldn't need to explain joke tier.
