Both Troops and Bounty Trail helped their creators move on to work in the film industry. Bounty Trail caught the attention of Lucas, who subsequently hired the fan-film director to work on the production of the second Star Wars prequel. The acting and screenwriting in most fan films are not exactly of Oscar-winning quality, and other production values tend to betray the films' amateur origins. In the Star Trek knockoff Hidden Frontier, you can't help speculating on the little things - like if those among the cast who actually look good in their Starfleet uniforms are the aspiring actors, while those who do not are the regulars at Trek conventions. A lot of the more popular films are fairly average - nothing more than light saber duels with little or no story.
Parodies seem to come up better than the serious films.
I guess if the film's not taking itself too seriously, it's easier for the audience to do the same. But, again, the effects aren't half-bad. That's partly due to the immense amount of sharing on the internet among fan film-makers when it comes to special effects and other production techniques. Many designers who have made their own 3-D models of Star Wars vehicles and droids are willing to share their work for credit on a fan film. As for the legal issues, fan films appear to fall within a gray area between fan fiction and parody, both of which are legally protected under US law.