I don't know if I'd call it their opinion on good design, rather I think the gauche output from non-designers is a product of lacking the ability to make/recognize anything better.
I'm not a sculptor, and if I attempted to create a marble bust it would surely look terrible. That doesn't mean I think it's a good sculpture, it just means that's the best I know how to do, so it works for me.
I do think that the bad design of these sites speaks more to the importance of "form after function". Maybe GeoCities pages were hideous, but they still enabled people to post their pictures/thoughts/etc in a way that most couldn't have figured out before that.
I agree with what you're saying, but I also think it leaves out the difference between an item appearing unfinished, and an item appearing gaudy.
To extend your metaphor, you're not merely carving a marble bust, you're also gluing on trinkets and coating it with glitter and plastering it with stickers.
I'm not at all dismissing the importance of MySpace and GeoCities and et al; I just think it's useful to look at them as a large body of research for the difference between professional and amateur design tastes.