I think villains can still be villains if they're humanised/have a plausible motivation for their acts. The big woobie route, well, I can believe that too if it's a clear-eyed look at what being a big woobie villain does to the people around you - actually, I can see a great tragic villain who takes out his real and genuine misery on the people around him to devastating effect and simply doesn't get why this doesn't help anyone. I think humanising villains is almost inevitable, unless they're a villain ex machina who only exists to roar and blaze and do hideous things to people, like a human volcano.

And yes, I'm right with you on playing The Game with fic, at least unless I'm giving myself special license to write crack.