Got a chance to see this, finally. I was kind of thrown off by a bit, it wasn't quite what I expected. It felt almost like a rough draft, actually. For one thing, I had acquired the impression that it was meant to be a comedy, but discovered that it's not funny at all. Instead it's sad, almost to the point of being depressing.
To those of you that are unfamiliar with it, it's the story of a would-be super-villain, who desperately seeks recognition, and achieves it, but at the cost of the life of the woman he loved.
It's weird, I sort of get the impression that it started out to be a comedy but the people making realized that it worked better as a tragedy, but then forgot to go back and edit out the supposedly "comedic" bits. (I mean, odd not-really-funny bits like the heel team being called the Evil League of Evil, and led by a bad horse called "Bad Horse", and Horrible's sidekick being a guy called "Moist" who has the power to dampen things - about the level of "humor" one might expect from a junior high school theatrical.)
There's no problem with the level of talent involved, with Neal Patrick Harris and Felicia Day standing out, particularly. The filming seems somewhat amateurish, but again, with the level of talent involved, I have to assume that this was a deliberate choice.
All that said, there are some good moments - the ending, with Horrible, in his moment of triumph, realizing what he has lost, but then going on to take his place in the ELE, is quite moving, actually.
It's been a long time since I saw this. A lot of my friends were raving about it at the time, but when I saw it, I was disappointed. It wasn't as funny as I'd hoped, the music really didn't do it for me, and like you said, it has a hard time deciding what it wanted to be.
"Sad is happy for deep people." - Sally Sparrow