He's dealing with It, he laughs less in Onigashima and is with his fellas (Kidd especially).
Not trying to correct you but its something that a lot of people interpreted wrong.… This was the chronological order:
- Killer is beaten by Kaido and brought in Mano
- Separated from Kidd, he's tortured and Fed with a SMILE (Kidd later mentions that for a mysterious reason he stopped laughing a long time ago)
- Works as a hitman for some time (under this psychological and physical stress)
- Crosses Zorojuro, loses the fight with him and is brought to Udon
- Has the definitive breakdown in Udon when Kidd is condamned to death with him
Was a progressive damage, Zoro (Zorojuro) met him (Kamazo) when he was nearly at the peak of it
We're not sure what kind of torture techniques they put Killer through, but there weren't any scratches indicating that he was still under any significant effects of them. He's became well-known to the Wano citizens as Kamazo the Manslayer, showing that he's been doing this for a while. By the time of the Zoro fight most of his injuries likely healed. He's likely wearing those bandages to cover his face since he really insecure about it.
I don't think any mental weakness was in play in the fight between Killer and Zoro as some time before this he's accepted this assassin role to save Kidd. It doesn't mske sense to me on why he'd allow his insecurity of his laughter get in the way of performing his best to take out Toki, making him one step closer to save Kidd. If anything he'd arguably perform at his best at the time since Kidd's life is on the line. Throughout the fight he was showing fighting intelligence. He wasn't just some incoherent, laughing mess acting of pure instinct.
He has only shown mental weakness when he was laughing uncontrollably in front of Killer, likely feeling shame to be in Kidd's presence in such a pathetic state, and failing his mission to assassinate Toki, likely in his mind sealing Kidd to an unfortunate fate.
The only concrete nerf Killer had as Kamazo was that he was given a scythe in the place of his Punishers, and that's absolutely wouldn't have an effect on Killer's speed.