The size of the storm led to high storm surges in an area which was both densely populated and frankly, vulnerable to the sort of flood damage that comes with high waves and a storm surge. So the economic destruction was huge, but in terms of storm intensity, Sandy was relatively mild.
I will grant that a Cat 1 storm can be formidable in and of itself, (I have been through a couple), but the intensity is still far short of a Cat4 or Cat5 hurricane.
Experienced a Category 4 living in South Carolina in the form of Hurricane Hugo.
Hope to never see anything of that nature ever again.
Ike was a Cat one. But like you said, it was huge, practically covered the entire Gulf of Mexico. Major damage 50 miles from the coast that had nothing to do with storm surge.