Citation needed on the implied good designs.

The two people I knew that used the site as 'designers' were doing so as a means to dip their feet into graphic design. They were using it to see if they even had a chance in the industry. I'm not saying good design can't be had, but when you're competing with people that are putting zero experience behind their work and they beat you out on subjectivism alone, it leaves a sour taste in my mouth and gives the winner a false sense of accomplishment in the field. I'm looking at their logo design page right now, and it's a mess.

Not to mention the amount of times people have made money off of plagiarized logos, iStockphoto vectors or blatantly used Illustrator (worse, Photoshop) defaults.

When Fog Creek needed a logo for Kiln, we went to 99designs and asked for a buddy for our goofy looking kiwi. We got a goofy looking dodo. Pretty much exactly what we wanted. I wasn't directly involved, but from what I know, I would totally use them again.

As someone who has used a place like 99designs, I would say that you can get good design, but a portion of the designers (i.e., the ones who try to make $ on volume wins) who are competing for your bounty also seem to be working from cookie cutter templates.