Using the Frying Pan as a melee weapon is definitely one of the high points TF2 has. But one thing I'm curious is the fact that everytime I hit someone, they seemed to be knocked into the air. Even though it is a stock weapon reskin, and its description does not show any advantages over standard weapons, does it actually cause a knockback? Or was it just the server I was on?
All damage causes knockback, even DoTs like burning and bleed (just try and keep your scope steady as an immolated Sniper!).
Crits get a significant amount of bonus knockback.
This means, if you crit, you can knock someone back a goodly distance.
If you noticed it happening on non-crits, or on every swing, then it's quite likely it was related to the server you were on, because the Frying Pan is simply a reskin of the stock melee weapons of the class that is using it. (I.e., Scout's Fryingpan is faster but deals less damage)