Exactly. Lips was never prominent. I could put out a big long list of how many tertiary characters were actually seen in movies and to what capacity. Wait, wasn't Lips actually in MMW?
Then, there's Robin who was only in 4 movies (including MMW), and the only time he wasn't a one-two line cameo was when he played Tiny Tim.
The problem is, the Muppets are loads and loads of characters. Numbers work better over the course of a TV series than in 80-90 minutes of film. That's when a smaller group works best. TMM essentially had only Kermit, Fozzie, Piggy, Gonzo and Camilla, The Electric Mayhem and Scooter, Rowlf, a very small part with Sweetums, and then Bunsen and Beaker at the end of the movie for a few minutes. But mostly Kermit, Fozzie and Piggy. Everyone else had small cameos in the theater watching the film. GMC had many more characters, and somehow they made the bigger numbers fit (but there are still a lot of faces missing). MTM went back to a smaller core cast of the main 4, the band, and Scooter (minus the new characters) with a couple others as cameos.
And while I applaud both TM and MMW for putting as many Muppets as possible into the film, but they do come just short of being too busy. It may not seem like they had restraint, but they did. Just barely.