I think most gamers could care less about events that took place more than a decade ago.
I don't disagree. I think you are right.
However, the answer as to how it was that the online world came to form this view about Lorraine Williams is entirely wrapped up in the Gygax lawsuits and the cease and desist letters of the mid-90s. As noted elsewhere in this thread, TSR became
T$R to many fans who were online back-in-the-day. The cease and desist letters were, in a sense, viewed as a RIAA style intimidation tactic used against the game's own fans. If you were online in the mid-90s and a gamer - she therefore became "the Enemy".
When you essentially declare war against your fans - that has consequences. I'm not saying that's what she, in fact, did. I'm saying that is how the cease and desist letters came to be viewed in the online world at the time - and that view of her, once formed in that crucible of online public opinion, has never changed at any time thereafter.
That cease and desist period cemented the view of Lorraine Williams vs. Gygax as the Uber-Hag.
Because that attitude pervaded the online RPG community, it became a sort of "received knowledge", an "accepted canon" concerning Lorraine Williams that was passed on to the community as it grew over the years. That attitude persists to this very day. Someone posted that it was "group-think" to some degree - and I don't disagree with that analysis very much either.
Mismanagement at TSR and its financial difficulties were not known to the online world when Lorraine Williams came to be reviled online amongst gamers, generally, and so I discount it as having any effect on how that view came to be.
Add to it the later disclosure of mismanagement at TSR and the revelation that Lorraine Williams appeared to have thought very poorly of TSR's customer base (she thought gamers were not her social equals and reportedly held most of us in contempt)... well....
Not hard to see how and why that original "online view" of Lorraine Williams nurtured in the mid-90s has been maintained over the years, is it?
The fact that your personal dislike may be motivated by other factors does not change the genesis of the "canon view", nor does it explain why that "canon view" has persisted for so long.
I think the above explanation comes a lot closer to a reasonable understanding of the legend of the
Wicked Witch of the Mid-West