Just to clarify, the Rifftrax guys claim that they don't actually like bad movies. These movies are simply bad, so the humor in what they do is their addition, and comes in part (and this is me filling in the gaps here) because humor is more natural and easy when it's reacting to something than when it proceeds from a vacuum; so I can make occasional jokes about philosophers but have a very hard time writing stand-up comedy. In short, humor should be occasional, i.e. a reaction to an occasion, not forced. The fact that MST3K/Rifftrax is forced in that the jokes come constantly creates its own challenges and internal resonances, meaning that getting steeped in their project is more rewarding than listening to just one riffed movie, and a lot of the appeal is the particular people doing the riffing as opposed to just the jokes in isolation (I find it hard to get into the various imitators on the web).
Now, my family got HBO when I was maybe 12 years old (that would be 1983) and for years I would watch virtually anything that channel would show, and after that until at least a couple summers into college my buddies and I would rent movies constantly, covering anything horror/sci-fi-looking no matter how obviously crappy, so I've seen my share of Ghoulies, Crawlspace, Troll (not in any way related to Troll 2, even legally), Silent Night Deadly Night, Phantasm, Witchboard (OK, I had to look up the name of that one; I just have an image of Tawny Kitaen all deviled out)... the list goes on and miserably on, but I will likewise say that while we appreciated crap, we weren't sophisticated enough to enjoy crap for crap's sake. We hoped that the movies would be good and cheered when they had a plot. In fact, any movie based on a book was automatically OK with us, because that meant that something would have to actually happen.
If you've not seen Ed Wood, you need to do that immediately. The story of the man known as the maker of some of the worst films ever is mighty entertaining, and it makes those films (Plan 9 from Outer Space being the most infamous) more enjoyable. Troll 2, given its comparative recency (it came out in 1990), now has more resonance for us folks that grew up in the 80s than Ed Wood's films offer, and apparently there have been Troll 2 parties and the like to celebrate its awfulness for some time now.
When the awfulness results in as much unintentional humor as it does in Troll 2, then it (supposedly) becomes simply enjoyable to watch, much like watching the antics of Borat or a Christopher Guest movie. But because this is so earnestly bad, it's not entirely like the fake school play in Waiting for Guffman, but more like a real school play, where you don't hate the actors because they suck, because, hell, they're little kids, and maybe they suck in a cute way.
Just as Ed Wood's life of terrible movies became an actually good movie about his life, a documentary was recently released (I've not seen it; it's not currently offered through Netflix at least) about Troll 2, made by its former child star, who tracked down the other cast members (most of whom were non-acting Mormons living in Utah where it was filmed) and documented the post-mortem love the movie has received.
Here's an interview related to that film, Best Worst Movie:
The end result is honest, sentimental appreciation for the people and events involved with something that in itself in no way accomplished its original aesthetic goals. Dreadfulness, scorn, and unintentional humor have led to actual sentiment and an affirmation of life. This is level 2 or 3 irony, just like in the Weezer song.
I am reminded here of Tom Wolfe in his book I Am Charlotte Simmons, about college life, where his characters distinguish different levels of sarcasm: Sarc One is just normal, obvious sarcasm; Sarc Two is being sarcastic in a totally sincere voice but then going over the top near the end so the victim knows you're being sarcastic; Sarc Three is like Sarc Two but with a much longer delay and more subtlety, so the victim only realizes the insult after the fact.
Irony is reflexive, though; to be ironic about irony is no longer to be ironic (I think it was in the Simpsons that two teenagers ask each other "Are we being ironic? Man, I don't even know anymore."), yet the self-defeating irony is supposed to make you cooler, like you're not a sheep appreciating what the masses appreciate without thinking, but someone who's escaped from conformity so far that you've come back in the other side. You may look and act like everyone else, but you're in the know, transcending your situation in a way that Sartre would be very familiar with.
So maybe the Troll 2 phenomena is Irony 3, i.e. doubly reflected, where you're at the state (Irony 2) described above, but then you deny your own transcendence and embrace the love of the thing in as honest a way as you can, though certainly not in the same way that say, a 10 year old might actually like Troll 2 without recognizing the terrible acting, lack of plot, crappy costumes and effects, and overall aesthetic and moral egregiousness.
To review this very seat-of-my-pants attempt at analysis here:
1. First level irony is almost like sarcasm; it's putting on a mask for a limited purpose of humor and social commentary, a la Stephen Colbert.
2. Second level irony is more like a guilty pleasure. You're in the mode of being ironic, but become to some extent the thing you pretend to be, even though if asked you still identify yourself as more sophisticated than the mask you've assumed.
3. Third level irony is the adult version of second level irony, with less Sartrean bad faith, less guilt in the guilty pleasure. If it's still irony at all, though, and not just a collapse back into the original non-ironic position, then there's got to be some insight that traces back through the preceding stages, a recognition of the absurdity of the mask even as we embrace it. (Maybe this is Kierkegaard's position regarding religion? We've just put K. on our calendar for episode #29, so you'll find out in a couple of months if you don't already have an idea about this.)