John Leguizamo being Latino is something I think can be forgiven when you realize there are actually a lot of similarities between Latinos and such Italians - but otherwise, yeah, he was an odd choice for Luigi.
What about Dennis Hopper as Bowser/King Koopa? Talk about ham and cheese.
But the absolutely worst acting in the entire movie? Daisy's father when he returns to humanoid form, where he delivers the only two lines he has in the most flat, most wooden, most emotionless way possible: "I'm back. I love those plumbers."