After discovering that people write fan fic about The Incredibles (to be specific, slash involving the pre-teen boy and the villain), I definitely feel that my life quality has declined since discovering that people write They Might Be Giants fanfic.
I think that most fan fic is just weird day-dream fantasies that, before the Internet, just stayed in people's heads. As someone who teaches writing, I'm glad that people feel inspired to write. But when your writing is confined to riffing on the creations of others - there's a point where it becomes less writing and more indulgent fantasizing.
Flannery O'Connor said, "People are always asking me if the university stifles writers. I reply that it hasn't stifled enough of them. There's many a bestseller that could have been prevented by a good writing teacher." Just think what she'd say about the fan fic fad.