InuYasha features a sword that heals: Tenssaiga, "the sword that can save a hundred lives with a single stroke." It would be amazing overpowered — except it belongs to InuYasha's brother, the demon Sesshomaru, who disdains it. More than that — it's not just a sword he happened to get, it's a sword their father had made for and willed to Sesshomaru specifically. It's a sword that doesn't do what a sword is supposed to do.
It would be overpowered — but Sesshomaru doesn't give a shit about healing anyone, so he doesn't. Except, puzzlingly enough, twice he does. It's not like he's reformed — he gets right back to murdering people as usual afterwards. But he used the sword, and he doesn't get anything out of it that he'd seem to value either time.
(Both times I'm thinking of, a child benefits. I wonder if there's anything to his psychology about that.)
Besides that, it's a sword Inuyasha and Sesshomaru's father had made for Sesshomaru. Sesshomaru often talks to InuYasha about their father when they meet. He punches InuYasha for defiling their father's grave. But Sesshomaru doesn't seem that interested in this sword or why his father gave it to him. I think he wonders to himself in an early episode why — but more out of frustration than a genuine interest, because the question has never come up again.
It's a sword that doesn't function like a sword is supposed to, so defective in that sense. It can't hurt anyone or anything. That fits Sesshomaru, who doesn't function as he was hoped to — he doesn't want to use the sword and mostly he doesn't.
It's powerful, it was made for Sesshomaru to do a job and he doesn't use it because he has no use for it — no interest in the job. That's an interesting combination.