When I played mundo last week I noticed a couple things
1) he's classed as a fighter and not a tank
2) his damage is actually legit. He does a lot of damage while out-sustaining you
3) his damage falls off dramatically the longer the game goes
4) he does become near unkillable but you have a hard time killing people by then
I thought about this some more and it seems less counter intuitive now. I think the main point is Mundo has very strong scaling, but the value he adds to his team goes down relative to other top laners as the game progresses. This is likely even more true in solo Q where teams will lack the coordination to properly utilize Mundo in team fight scenarios.
If you watch enough LCS or Champions I'm sure you'll have heard something along the lines of, "This Mundo is going to become completely unkillable pretty soon." It's a common trope casters love to harp on. Ability to not die does not scale directly with a champion's overall value. Even though there are very few or possibly no champions that scale better with tank items than Dr. Mundo there are many champions that are stronger late game (ryze) and/or add more value to a team composition (gnar/lulu).
Champions like Mundo are only good if you got good engage and a good backline. Your goal is pretty much to sit on carries and then die later than the opponent frontline that tries to do the same. If you got Corki as your backline lategame and you are sitting on a KogMaw, then you are not going to do anything as Mundo
Especially in competitive there is a specific reason why you pick Mundo, for some time it was mainly a counter to the likes of Lissandra who can't touch you and you just run her down.
1. 1-shotting people as Nasus is a huge advantage. Damage > tankiness in late game scenarios.
2. Nasus is going to be great at pushing late game objectives as well as teamfighting; Mundo is only going to be good in teamfights.
3. Mundo wins the lane and will cap out on items sooner, so in fact his late game scaling tapers off sooner because he can't build more items while Nasus can.
<3 Mundo. About time he got his own appreciation thread.
Mundo is very strong from like levels 7-14. Once his Q is maxed it does pretty solid amounts of damage and his sustain is so good.
He is great against AP tops because you just rush SV and they can't really do anything against you because your health regen makes it impossible for them to keep chunking you down before they run out of mana.
AAs mainly let him be better in lane and now he is actually a viable jungle. (You take Q-E-Q for first clears).
A problem with mundo splitting is the sunfire effect. you pull aggro too fast.