Don't get the ex-NBA coach wrong ... he likes Melo and thinks he can still shoot it -- but, he tells TMZ Sports, the market for the 10-time All-Star after he moves on from Houston will be wafer-thin.

"It's gonna be hard, man," Scott says.

Byron's biggest issues with Melo? He says the dude can't fit in with teams looking to rebuild with younger players -- and he can't fit in with squads that get up and down the floor.

So, Scott says the only possible landing spots for the future Hall of Famer are with veteran, half-court teams ... or nowhere else.

BTW ... we also asked Scott about the Lakers and the job Luke Walton is doin' -- and he says everyone just needs to be patient when it comes to LeBron's first year in Hollywood.

But ... we had to ask -- would he consider linking up with his ex-Lakers teammate, Magic Johnson, and coaching L.A. if Walton falters??