From SmashWiki, the Super Smash Bros. wiki
DUMMY is a stage in Super Smash Bros. Melee which can only be found via Action Replay. When activated in the debug menu, it crashes the game because the game does not specify a pointer for background music. This can be rectified through another hack that presumably forces the game to present the stage without background music. DUMMY is primarily composed of empty space over a black background, save for a lone invisible platform in the center that can only be seen using the debug menu.
Unusually, while the stage has a standard set of blast lines, they are located extremely far from the stage's center; as a result, the game will crash before players come in contact with them, due to the game being unable to process the character's position on the screen.
While other unplayable stages, such as TEST or IceTop, were likely used for programming tests or acted as potential ideas for playable stages, DUMMY's purpose is unknown and no information within the games suggests what its intended purpose was. It has been speculated, however, that the stage is used for the results screen.