They're only "horribly oversized" if you insist on all your figures being compatible scale-wise.
Well, DUH! I collect 1:6 scale so yes, when something is released, and promoted as being 1:6 scale I do expect them to be compatible with the rest of my collection.
Captain Action was meant to compete with GI Joe 40+ years ago, but he's not completing with Hot Toys so the comparisons there are unfair. He is meant to still be a toy for kids and an option for those collectors that don't want to spend $150 or more for a Nick Fury that isn't even what we grew up with. He's an affordable throwback to when you could go to a toy store and come home with a figure.
And he fits in with the rest of the collection.
He has succeeded and its great to see him back!