I think the main point of the article is to make sure to make your characters human — even if they aren’t the protagonist, which I agree with. In my opinion, there is nothing wrong with having a crazy homeless character — just don’t make their defining characteristic their craziness.
I did have a big problem with #5. The masses can be terrifying. Mob mentality brings out the worst in people. It happens on all sides too.
Although he does have other characteristics, as his condition worsened, all of them became buried underneath a web of paranoia and madness.
I can't honestly believe that someone who didn't know them personally in the good days, would be able to pinpoint any bit of their natural personality anymore.
In film and TV, crazy homeless people often exist as extras only. If they have more screen time, their background story is usually told as well.
but if you accept this idea, why stop with the examples presented in the article? what about all the biopics that exaggerate or entirely fabricate conflicts in people's lives to suit the structure of a typical plot arc? what about the fighter jets in top gun that fly way too close together so they can actually fit in the camera's FOV?
I think example 2 (Poor Heroes Have Expensive Lifestyles) is going a bit in this direction. is it misleading that jerry seinfeld, a more or less unknown comedian in NYC, has a huge apartment on the show? yeah, probably. would it work to film all the apartment scenes in a 450 sqft studio? probably not.