It works just fine on bedding fish. Been catching quite a few that way here in Indiana for the past week and a half. A few more thoughts I'd like to share based on what I've been reading on the forums to help clarify a little about what the bait and technique is or isn't. Seems the more people post, the more confusing it ("Ned Rig") becomes at times.
Don't make the Ned Rig into something it isn't. The primary concept behind it is to assist in the task/goal of catching 101 bass a trip (4 hours). Yes, you can expand on that basic concept as others have shown, but that is the main theme behind using it. See: http://www.deseretnews.com/article/700241837/Bass-101--its-the-target-not-a-course.html?pg=all
As such, it's small size is geared toward picking up numbers of bass, but as others have posted, if a big fish gets in the way, it will entice them too. They're a bonus - not the primary goal. Ned caught and released what many considered to likely be a new state record class smallmouth (Kansas; 6-10) on it just a year or two back, and recently tangled with another that size already this spring (got off boatside before being lipped).
"Ned Rig" is a generic term for the mushroom head/small plastic/spinning rod/braid/leader fishing concept. It is not just a 1/2 ZinkerZ or TRD bait on a jig head. There are actually about 8-10 different plastics Midwest Finesse anglers (the broader term for anglers using the rig and it's counterparts) routinely carry and use, some of which aren't Z-Man baits. The Z-Man plastics are simply preferred for their durability and efficiency. Some days the fish want a different shape. We use small craws, leeches, finesse worms, shad-shaped and lizards also. However, all baits are 4" or less in length.
Obviously, the bait isn't designed for fishing in and around heavy cover. In fact, the concept was designed to specifically avoid such areas. Most all regular bassers get drawn to heavy weeds, laydowns, brushpiles, and other obvious pieces of cover. Midwest finesse anglers specifically target more open, unattractive banks (rock banks, clay banks, sparse weeds, open flats, etc.) because we feel the bass in those places are less pressured. We leave the heavy cover stuff to the masses of anglers with power gear.
Stained or silted waters aren't an issue. Midwest finesse is as much an off the bottom presentation as it is a bottom presentation. Swimming the bait slowly just above bottom with shakes and pauses can be just as, if not more effective, than letting it sit on bottom. Even what we call a "straight swim" retrieve can be exceedingly effective when the bass are active. Don't think of this as a bottom bait - big mistake.
Also, one reason we like the gopher heads so much is because they come in a variety of colors including fluorescent red and chartreuse. In stained water, we frequently use bright colored jig heads. Does it really make a difference? Depends who you ask, but it is the equivalent of dipping your plastic tails in bright dye, just on the other end of the bait. Elaztech doesn't take dyes well, if at all. This is our workaround. If we feel we need extra flash or vibration, we simply add a tiny spinner blade to the existing set-up.
-T9