As someone who originally got into watching LP's on the Something Awful LP subforum, and then started doing my own LPing about a year a half ago, the only thing I can really say about it's current state is that it's grown exponentially.
There are more LPer's and more commentary styles out there now than ever before. Sure, some of them might not be your cup of tea, and some of them are downright awful to pretty much anyone (camcorder LP's much?), but as people in the thread have said, there's usually at least one or a dozen LPer's that will appeal to most any tastes.
Personally I'm a fan of LPer's that focus on thoroughly showing off a game that they're extremely familiar with and have spent more time with than the average player, giving a better overall look at a game than the player would normally get. LPer's like ChipCheezum, Voidburger, and SuperGreatFriend, who coincidentally you won't find much of on Youtube.
Anyhow, to avoid further rambling, I honestly think that the quality of the LP is often tied to the reasons why an LPer LP's. I myself LP because I enjoy it, and because even before I started I would constantly commentate about whatever game I'm playing to myself, so it wasn't much of a change to doing it while recording. LPer's who do it for money or popularity usually put out lower quality stuff more frequently, and develop this attitude that they have to suffer through games they don't enjoy for the viewer's sake. If you're not having any fun, how can you expect the people watching to enjoy it in a way other than schadenfreude? To continue to beat a dead LPing horse, people like Pewdiepie (the flavor of the month) take something away from what makes the best LPing by forcing themselves to react for nonsense and physical comedy, with the background distraction of a game as their safety net if they aren't being funny, while getting paid for it.
The other reason I enjoy LPing is that I've always loved sharing the things I enjoy with other people, whether it's describing a movie in intimate detail or just buying a game for someone on Steam that they might not play otherwise. LPing lets me cover the older, indie, or less well know games for people who would likely never play these game themselves, but find them interesting enough to watch. For example, pretty much any survival horror game, which people seem to prefer watching over playing because of the bad controls, fear factor, and the sometimes obscure puzzles.
The one thing I think that tends to hold back most would-be LPer's is a complete lack of any technical know-how, something that's pretty easy to obtain through Google. Pointing your dad's old camcorder at a TV is not a good solution, as you might as well just be narrating a series of still images for all the good it conveys. That said, one of the reasons LPing has expanded so much is because of how easy it is to do. All you need is a copy of Fraps, a headset, and any old video editing software as well as a Youtube account to get started. I think as time goes on more people will pick up on the technical aspects of it and the number of people at the bottom of the LPing barrel will shrink.
And really when it comes down to it, "Good. Bad. I'm the guy with the fun."
TL

R LP for fun not cash, camcorders suck, do some research before LPing.