The problem with most fan fics is that most people aren't fans.
Male fanfic writers wind up doing harems or they have an OC character that they want to be awesome. What better way than having your OC be awesome by beating up Batman?
Female fanfic writers can write a better story, usually, except there isn't even the pretense of respecting the source material. Everyone starts acting out of character and does whatever the plot demands. You wind up with Batman in an apron doing house work and pledging his undying love and shit.
Take vector in DC.
Now, I don't know what the hell a vector is, but he's in DC and can defeat everyone with a thought, create super technology by reading the internet, gets laid by all the women he meets, and has AI servants to stroke his ego when nobody else is around to tell him how awesome he is.
He has no real set backs, and never suffers the consequences of his actions. He gets a bunch of civilians killed, but doesn't give a crap. He murders many a nameless Mook without so much as an eyeblink, then shoots the joker.
I highly recommend it as a wonderful example of how not to write a fan fic.
No. I mean it. It's entertaining enough you won't scoop out your own eyes, but it keeps falling into the same traps over and over that you get a good feel for why it's bad fan fiction.
Most fan fiction writers aren't fans.
Batman is a moron. Lex Luthor is a cartoon. The power sets of the DC characters are nerfed or not respected because this Vector dude is the soooo kewl. He's always ten steps ahead of everyone and he's using the DC to stroke the MCs ego. Hey, to each his own. Its got an audience. If you like a power fantasy, great. Go for it, dude.
But since DC comics has been turned into fan fiction by the owners of the IP, finding stories about DC characters is hard to come by. You can write about your OC, and do justice to the originals. Most fan fiction writers don't understand the value of losing, or being overshadowed, or just flat out being saved.
Defeating the bad guy isn't as interesting as picking a fight in over your head, barely holding the line, and getting your ass saved at the last second so the the MC goes, "damn. I need to learn from this."
But that might make my OC look weak and we can't have that, can we?
So, fanfics get a bad wrap because if you are good enough to write the story well, you aren't likely to be writing fan fiction. The system is self selecting for crap.