I think what makes for good lyrics can vary significantly.
1. In some cases, lyrics with a message are important. Songwriters like Bob Dylan, Richard Thompson, Warren Zevon, Leonard Cohen, Lyle Lovett, Neil Finn and Paul Simon are seven good examples.
2. In some cases, lyrics with a message and a sense of humour are important. Songwriters like Randy Newman, Warren Zevon, Leonard Cohen, Lyle Lovett and Paul Simon are five good examples.
3. In some cases, lyrics that are as much about their rhythmic connection to the music can be important. Jon Anderson, in particular Yes from Fragile through Relayer, is a particularly good example.
4. In some cases, autobiographical lyrics that aren't too navel-gazing can be great. Lyle Lovett, Randy Newman, Leonard Cohen, Neil Finn and Richard Thompson are a few good examples.
5. Dark lyrics when handled with nuance and subtlety can really work. Richard Thompson is probably the best example of a lyricist who can be as dark as all get-out, but never hits you over the head with it.
6. Lyrics that suggest religious connections can also be great if they're not overly preachy can be great. Again, Richard Thompson, when he was in his Islam period, managed to deeply reflect his beliefs of the time without hammering you over the head with them, and so were particularly fabulous. Ditto Leonard Cohen.
I know there's a lot of repetition here when it comes to names, but for me, whether it's these guys or others like Lucinda Williams, Elvis Costello, Jeff Tweedy, Shawn Colvin, Peter Gabriel, Party Griffin, Steve Earle, Willie Nelson, or many, many others, what it comes down to, at least for me, is lyrics that are poetic, make whatever point they want to make without beating you over the head with them, and manage to say things in unique ways are what draw me to them.
I know I'll get lambasted here, but most progressive rockers don't work well for me, even if I love the artist(s), because they're too direct and lacking in subtlety when trying to get their messages across. I mean, stories, as Genesis did in its Gabriel and early post-Gabriel years work for me because few progressive rock bands were actually storytellers. King Crimson, much as I love them, varied widely when it came to lyrics. Some of Peter Sinfield's lyrics, (sometimes overly) poetic and flowery as they were, could be very good but, at the same time, really fell flat when trying to be "message" songs, like "Ladies of the Road" or "Cat Food." Palmer-James was less flowery so more successful with some of his lyrics ("Book of Saturday," "Starless," "Fallen Angels") but also fell flat with songs like "Easy Money" "Doctor Diamond" and "Great Deceiver"). Belew was better with his kinda post-beatnik lyrics, and was probably the band's most consistently solid lyricist, but even he managed to write some clunkers. Roger Waters excels at "message" songs that really lack in subtlety and best you over the head with whatever point he's trying to make. Gilmour I find more palatable, but I'd still not consider him a great lyricist by a long shot.
I think it's because the real "greats" (Dylan, Cohen, Newman, Lovett, Simon, Zevon, etc) are more focused on their lyrics than the music, or at least, the words are as important if not more so, than the music when it comes to their writing. That doesn't mean they don't write great music (at least in some cases), just that their focus has always been at least equally balanced between words and music.
Just my thoughts, which I'm sure can be easily torn apart, so have at it!

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