The frame sounds too large, particularly if the TT is sloping, then it's definitely too large - may be two sizes.

The idea that the next size smaller would be too small is nonsense. Most adjacent sizes only require one size shorter or longer stem to have the same reach. The stack height or handlebar height difference is often larger - in the 10-25mm range.

What you really need to do is post your true cyling inseam, or better yet, an accurate saddle height and some more info on the bike.

As for the bike feeling sluggish, that's not too likely, since the weight balance would only be slightly different that it would be for someone who fit the bike perfectly.