The main downside to this is it doesn't work well on a Legendary creature, correct? Actually, despite having to sacrifice the new token copies that enter, any enter the battlefield abilities still trigger. Because of how the Legendary rule works, you can choose to keep your original Legendary on board. Also, because these tokens are forced to be sacrificed, they trigger “when it dies” effects, which for certain Legendaries, such as Kokusho, the Evening Star and Vela the Night Clad, is a big deal. Ordinarily, you wouldn't get "when it dies" effects since the tokens are exiled at the end of the turn. But with Legendary Creatures, the rule actually benefits you with the Blade.
Most of the time, however, you’ll want to use this Equipment on non-Legendary creatures that have enter the battlefield abilities that you can abuse. Four mana seems like a bit of a steep equip cost, but it’s worth making free copies of creatures. With Eternal Witness, you can get one, two, or more extra cards back from your graveyard each time that Witness attacks! Being an artifact, there are hundreds of creatures that this Equipment will work well with and it can fit into any deck. Since these tokens must be exiled at end of turn, decks that have sacrifice outlets can benefit, as well.
There are so many options with Blade of Selves. Yes, this Equipment is only good in multiplayer games. But this includes any multiplayer format that supports Legacy-legal cards such as Archenemy or Planechase, not only Commander. Since it can fit into any deck being a colorless artifact, this is a super fun, sometimes game-ending, inclusion in a wide array of decks.