From the Super Mario Wiki
Flat Zone is an unlockable stage in Super Smash Bros. Melee. The place is located in Superflat World, and is Mr. Game & Watch's home stage. It is unlocked by beating Classic or Adventure as Mr. Game & Watch at least once. The music is actually modernized 8-Bit music.
Its main gimmick is a figure hanging on the platforms, who will move occasionally, causing some parts of the platform to move somewhere else. Other less common features are falling wrenches, buckets, and other tools. Although that doesn't sound too bad, the tools are incredibly devastating to lower handicapped players (being able to KO them at low damage), while being just a nuisance to higher handicapped players. Also, a man carrying oil will pass by and drop it onto the Stage, making that ground very slippery.