I am a more classic villian type guy where the main villian is typically not near as powerful as his minions. They are typically just very smart and extremely manipulitive in that they can alter events and throw people off the track.
This is usually the mad scientist type or the disrespected noble. There are tons of examples of this like Tyrion from the Martin books. He is weak and disfigured but very treacherous and highly intelligent. Read books on the War of the Roses and you can also find several true historical examples.
Of course the nasty brutal villian works well in some circumstances. However the ones I found that inspire the most fear are both cunning AND ruthless. One of the best examples I have seen in popular television recently was Angel in the BtVS series on TV when he was turned back in to Angelus (season 2). The stories they told of how he used to be were pretty inspiring for creating a wicked villian.
However like someone said earlier Evil is a state of mind. A majority of the evil people don't think that they are evil..... those are the ones that should scare you. If you want to see a great example of this.... well not great as in good... but as in accurate historically there is a book called "Hitler's Willing Executioners" which talks about how Hitler manipulated people in to commiting atrocious acts to other humans but convinced them in such a way that they didn't realize what they were doing was horrible.