Wouldn't it make the most sense to use in game time for Individual Levels? It would be the most fair way to compete and it avoids some weird situations where the faster runner is placed lower on the leaderboard. An example is https://www.speedrun.com/ssbu/run/zxgnv38y vs https://www.speedrun.com/ssbu/run/yd69npxz. The first user was objectively faster but is placed at 5th instead of 3rd.

Most people don't take the time into retiming their own runs via the in-game timer, so it has been a secondary method since the start because of this. It is a tremendous pain for a mod team to have to do all this work themselves, its literally multiple thousands of runs. We understand the issue with Physical copies vs. Digital copies and how that may make runners lose out on "technically having world record". If the in-game timer was finalized in-game like Smash 4 for example, then the timing methods would be swapped. Attempts have been made by some of the mod team to retime current PBs across the entire board but has halted due to the sheer amount of effort and time that would take. I don't think swapping the timing methods will happen anytime soon.

Is creating two different categories not an option then? Or even just requiring in game time for a run that is top 10 or whatever place you feel is high enough? It would help to build a competitive environment for those who want a really high placement while also avoiding giving certain runners an inherent advantage.

It is all the same run, separating them based on timing method doesn't make sense, especially since for the ones that do have accurate IGT displayed on their run would basically turn into double submissions (since moving them over would disrupt the leaderboard), which is not how this should be done. Like I said, mods have spent some time on doing especially the top times which you can see on at least the first half of ILs but its gotten to be a bit much. There really isn't a good solution, its just human expectation that caused this, and also to blame the developers for not finalizing the IGT like Smash 4.