I tend to have a strong dislike for Western art that tries to imitate common anime/manga designs, as I feel it ends up looking as some sort of cheap, generic compromise or hybrid that lacks the charm of both traditional manga and cartoons. Most recently, I found Skullgirls character designs to be a rather hideous example of this... It's the kind of art that I would expect to find among amateur artists on DeviantArt... And it's a shame, because I do sympathise with the attempt to create a fully 2D fighter in this day and age. But of course, to each his own.
And yeah, as a big Street Fighter fan, I still have issues with how IV looks... I'm not a fan of how the characters are now more "buffed up" than ever, or many of the characters faces (specially Ryu's, my favorite character), or the new characters, or the more "realistic" color palette (I have a similar issue with MvC 3 as well...). The move to 3D is obviously a part of all this, as while I did have some of these issues with III, the wonderful 2D sprites were more than enough compensation there. Still, I wouldn't include IV as an example here, and I'm already used to it by now.
I also agree about Wind Waker's character designs, Escape from Monkey Island (I blame the move to 3D here...), DmC: Devil May Cry designs in general and Miis in general (even though they do fulfill its purpose quite well), but not nearly enough to include them among the worst either. And while I could mention some realistic Western games here for seeing them as bland and generic, I do have to wonder how much of that is on purpose... So I better not mention those.
Oh, I almost forgot... The CD-I Zelda games... And perhaps Bomberman: Act Zero...