Typically, hacked games are just immature crudely made graphics hacks, but some are really well done. I personally think, that if you're gonna hack a game, you should do it well. The best hacks change a large percentage of the in-game graphics, and sometimes even change the sounds or levels.
What are your favorite hacks?
Here's a couple of mine: http://raccoonlad.topcities.com/petshop.html