West is quick and has good lateral movement but puts himself in untenable positions* as a defender. He defends too close to his man. In doing so he can't take advantage of his lower-body strength and good balance** because the offensive player can make a strong move at a fairly tight angle to either side and get his hips past West's hips. West's positioning restricts the space he can defend. This is why he uses his hands so much. The geometry of his positioning renders his lateral movement mostly useless. He can't beat the offensive player to a spot nor can he push him in the direction of his defensive help.
Were West to play one step further back from his man on the perimeter, I believe he could keep his man in front of him, and, when called upon in an emergency be a positive contributor defensively as long as he remembers to block out.
*As does Mike Woodson, to be completely fair. When I say Mario West could be a good defensive player I specifically mean against perimeter players: wings that work off the dribble and bigger point guards. I don't think he has the size to guard anyone successfully in the post with he possible exception of Flip Murray when he's backing down. Unfortunately, this is essentially the same class of player that Mo Evans defends best and Evans offers offensive contributions of which West can only dream.
**Said good balance refers only to West when in a defensive stance and not when he's attempting to land after jumping.