As long as the film is full of incompetence, it doesn't really matter I guess. But the caveat to that is that there has to be a lot going on. Take Halloween for example. I thought the Rifftrax was kind of boring, but that's because there was nothing happening on screen to make fun of (which is why they got so much mileage out of joking about how nothing was happening).
One of my favorite MST3Ks of all time is I Accuse My Parents. To be fair, it was probably one of the higher-quality movies they ever watched: decent acting, decent writing, decent directing. It was just that the premise was so damn goofy. Much like the Matrix. A great Rifftrax because there was so much going on that you could call attention to many different things. These also go along with what you were saying about movies taking themselves too seriously. Much like Reefer Madness, I think IAMP was made by some church group.
But my favorite riffs have been these horrible attempts at the sci-fi genre from the past 20 years. Hobgoblins, Space Mutiny, Time Chasers, Future War, and the like. I also love when they do Japanese movies. Any Japanese movie. I love you, Japan, but what is your deal?