Oswald Cobblepot is actually my favorite Batman villain hell maybe even comics in general. It's a shame how often he gets overlooked for a lot of the Arkham loonies.
I think Penguin is often underrated and under looked. The main problem is people don't see him as a threat. Another problem people have is they don't think he's interesting. I personally prefer his more classic interpretation as the "Gentleman of Crime" over Batman Returns approach or the brutish thug in the Arkham games. Id even say where Joker mirrors Batman, Oswald mirrors Bruce Wayne.
Heck I find it interesting how he's been seen to run for public office in multiple incarnations. He could totally be the main baddie in a Batman movie, he's simply more of a cerebral threat, an eccentric criminal who is affable enough to rise up to a rank where he has the ability to turn Gotham back into the corrupted city it was before Batman's influence, undoing all the progress that Batman has done. He's a villain Batman can't just punch out. I think it was Penguin Triumphant where Batman said Penguin was even smarter than the Dark Knight himself...