There's evil and there's evil. The problem is that some people think they're playing an evil character when they're actually playing a deranged psychotic homicidal lunatic with the personality and intelligence of a dead slug.
I blame comic books and cartoons.

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I mean, let's face it, do you really think the Nazi's were sitting around a coffee table practicing maniacal evil laughter and telling each other how evil they were?
Good and evil are matters of perception when judging your own actions. Doing evil just because you're evil doesn't make any sense whatsoever. Even serial killers have some deranged kind of reasoning, using spurious and convoluted logic, to justify their actions. While their acts might seem random, they are not.
An "evil" character justifies himself for not obeying the "common rules of being good" be they the ten commandment or the universal human rights, or the Elven Manifesto or whatever, usually by excluding certain groups from what he considers to be "humans".
These can be "orcs", thereby justifying slaughtering whole caverns of Orcs, men wives and children, because they are thieving murderous creatures who cannot listen to reason, they're all evil, a drain upon society and they piss in the genepool by making half-orcs.
Or women, because they are weaker then men, therefore the Gods have clearly indicated that they are inferior, so they can be sold and abused and whatever.
Or the poor, because poverty is clearly a sign that they are not to be trusted. If they were, they wouldn't be poor. And so on.
If society as a whole agrees with your exclusion as a subgroup, you're considered good.
For example : If the Human adventurers clean out The Caves Of The Goblin King and bring back his head, laden with treasure, they'll be celebrated heroes and the mayor will offer the hand of his daughter in marriage.
If they don't, you're evil.
For example: If the Humanis Policlubbers in the Shadowrun Universe go to East-London and set fire to the housing projects, gunning down any Orc or Troll that comes running out of the inferno, they will be celebrated by some, but hunted down by the police and army as dangerous violent terrorrists.
Same action, different setting.
Another option is that your moral values are vastly different from the main society, usually because you're from an entirely different culture.
For example, the Aboriginals from Australia had no concept of animal husbandry. They could not understand that an animal could be owned by someone. So they did not understand the anger of the sheep-farmer wen they ate one of his sheep.
For the Aboriginals, the sheep-farmers were evil, because they attacked the aboriginals unprovoked, while they were having dinner, even offering to share their dinner didn't calm them down, it even made them more angry. Clearly, they were insane and evil.
While the sheep-farmers were quite enraged at those thieving aboriginals who added insult to injury by offering him the remains of his own bloody sheep that those thieving buggers stole. Evil buggers, better to get rid of 'em.
So playing an "evil" character is just a matter of perspective. Wich is why I sometimes enjoy playing them, it's quite an effort to consistently play such a character.