In certain gaming circles, the name Lorraine Williams is synonymous with "Evil" -- others reserve such ire for Gnomes. While I have read many blog/bulletin board posts excoriating Williams, I have never been of the opinion that she was bad for TSR or even bad for the roleplaying game hobby.
Largely, this stems from the fact that Williams' tenure at TSR is one that I consider a Golden Age of rpg gaming goodness. Under Williams' management TSR published the Forgotten Realms setting, and excellent Buck Rogers roleplaying game by Mike Pondsmith of Cyberpunk fame, Al-Qadim, the D&D Gazetteer series, the Advanced Marvel Superheroes rpg, and the highly under-rated Rocky and Bullwinkle rpg -- something that was aimed at bringing new people into the hobby. Meanwhile, Gary Gygax was making the unplayable Cyborg Commando at New Infinities Productions. There are those who blame Williams for Gygax's being forced out of the company, but I believe that had more to do with the Blumes than with Williams herself. I also think that Williams hard fought battles to preserve the D&D brand, and all other TSR brands, were just good management -- not good PR, but good for the company.
I also believe that Williams only had a limited understanding of the gaming marketplace. She understood where gaming was in the late 80s and early 90s, but (not being a gamer herself) she had no clear vision for how to respond to the emergence of Magic: the Gathering. Her response was an explosion of rpg product and a rushed collectible card game response. The explosion of rpg product was high quality -- Birthright and Planescape were remarkable settings -- but the prolific pace of publication, combined with a brand diluting low quality card game, put more product on the market than the market could bear. In that way, she is also responsible for the implosion of TSR as a company a decade after she took charge. It would have been nice to see someone else take over the company after 5 - 6 years of Williams running the company.
The bitterness between the Gygax camp and Williams isn't the only case of deep bitterness and ire in the gaming community. I was recently reading some back issues of Interplay magazine, Metagaming's house organ after Steve Jackson left the company. I was amazed at the venom they were directing at Steve Jackson. Not because the split was a genial split, but by the obsessive nature of it. Metagaming seemed obsessed with mocking Steve Jackson every chance they had. Ironically, fans of GURPS -- and most modern gamers for that matter -- are likely oblivious to this deeply felt hatred. The Williams is "Evil" meme has lasted decades, but the Steve Jackson is a "Turkey" meme died long ago. Unlike the Gygax/Williams affair, Jackson leaving Metagaming lead to that company's rather quick demise. Steve Jackson was a font of ideas, while Metagaming was wallowing in bitterness. GURPS may be, and I certainly think it is, a direct descendant of "The Fantasy Trip" and Steve Jackson's early board games might have been indistinguishable in appearance from Metagaming's microgames, but the fact is that Steve Jackson and his company were coming out with quality new products while Metagaming was living in the past.
Metagaming has two famous spoofs of Steve Jackson Games material one is their Fist Full of Turkeys game and the other is a spoof of Steve Jacksons excellent One Page Bulge called One Page Bilge.
It should be noted that one of the things that makes Metagaming's protests against Jackson so purile is that Jackson was one of the leading voices advocating for designer rights in the gaming industry. Eventually his desire to see designers properly compensated led to him forming his own company, but the fact is that gaming is one of the last venues where the creators see almost no benefit for their creations due to the "work for hire" environment in gaming. People like Wolfgang Baur deserve credit, and ownership, in products like Dark*Matter, it's the only way to guarantee high quality and it is the right thing to do from a PR perspective. Imagine if designers had options on the systems they created. The Pinnacle Entertainment Group edition of Torg would be more than a pipe dream, and GURPS might be called The Fantasy Trip.