Actually I do not ban the SC in games I master, but I severly limit it - meaning gaining the feat and acquiring magical chains (usually only from certain cultures and some planes, such as the Nine Hells ) , as well as not permitting certain (by judgement calls) uses depending upon circumstances. Matter of GMing style though, hence not a rule.
examples
- striking (from the second row - 10' distance ) into an established melee, especially not against enemies of equal or smaller size without giving at least a bonus for cover
- no reach in tight corridors (5') since there is no space to properly deploy the weapon.
- penalties to attack in obstacle rich environments (woods/undergrowth )
This does not limit the SC's use in open terrain or more spacious setting, but imposes a degree of "reality" on its use. We do have some rule benders in our group(s) and even they agree that striking/lancing through a narrow doorway with an SC is.... cheesy, and physically hard to envision. I absolutely agree withe Celebrim there.
My main problems with the SC are that it basically is a "best of two worlds" weapon - reach + 5' area threat, dual wield (additional attack close up) and two-handed weapon (increased yield from STR-bonus ), capable of Weapon Finesse and capable of Power Attack. In combination with Combat Reflexes and Hold the Line (+ possibly Imp. Trip) this makes for a very deadly and versatile weapon - far more so than any other weapon in the RAW arsenal. Yes, it is an exotic weapon - but even for the invesetment of one feat to use it, it is an excellent deal. Perhaps compare it a Guisarme, Glaive or Ranseur.... and at higher levels, the actual damage dice of a weapon become ever more insignificant in the calculation of damage, as STR-boni, buffs, and manouevres increase the damage portion of any hit. Not to mention boni from Power Attack etc.
I also have a big problem with the damage type "piercing" - the short spikes (2" ?) are not really what does the damage, but rather a slashing/ripping or bludgeoning force from the impact itself - but that is merely a question of realism, not game balance
As for "Sunder" - characters will (IME) usually go for adamantine/cold iron/greensteel forged chains, which, in combination with any magical enchantment, make the weapon pretty resitant to sundering (at least as much as any other weapon ). So, no real problem there, or rather a risk any seasoned player will know how to resolve quickly enough.
Storage likeweise is not usually a problem - a cleric (FR, Kossithian) in my camapign carried it looped (like a whip) on the belt, or wrapped around his full-plate arm-greaves, and 'gloves of storing', or the "mutable" weapon enchantment offer easy alternatives. A character in another campaign stored his in a quiver on the back, whipping it out over his shoulder. A hip-quiver should also work well enough....
And lets not delve upon the increased capabilities if used by a cleric under the effects of "Righteous Might" or enlarge and other beneficial buffs..... The cleric mentioned above was absolutely viscious when wielding it, luckily, he never got around to acquiring Power attack...
It's just a weapon too good for the investment needed, to not balance it with some "realism-drawbacks".
YMMV
PS as for Kill-Bill #1 - I really don't see a cut-and-edit fight sequence as validation for any weapon's capability, especially not if, as the Ball-and-chain employed in the movie the damage was caused in a way not possible for a "SC" as described in the RAW and PHB.
For a demonstration what a ("harmless-by-PHB-rules") weapon can do, perhaps watch "Musa - the Warrior" where some awesome displays of spear-fighting are shown. Without editing cuts, I might add =)
And I wouldn't allow that stuff ingame without the expenditure of several feats either.