SW Canon's pretty good. It's far cleaner than most other fictional universes. Take for example Star Trek, where all the books are non-canon(even ones that don't clash with the series/films), with only the movies and series being canon, and even those having the "fun" of alternate universes like the new Star Trek film. And that doesn't even count Star Trek's long-standing mirror universe of evil people with mustaches.
SW has a firm canon, where all events fit on a timeline and all planets fit on a map, and everything is canon except things that are completely contradictory(like the non-canon "What If?" comics under the Star Wars Infinities label). The books are canon and everything is part of a cohesive universe. Any contradictions are usually explained away in retcons pretty quick, and so clean that you'd not notice the problem afterward.
Like Boba Fett's backstory after Episode 2 changed it. Jaster Mereel was retconned to Jango's mentor, and the EU retconned and glossed so that Fett came out of it all as the frickin Mandalore, a far stronger position than he had before Episode 2. Mandos are fine. The hippie Mandos of TCW were retconned the same year of TCW's episodes, with The Essential Atlas establishing them as a passing fad that disappeared into obscurity shortly after the Clone Wars. Don't know the Jedi inconsistencies you speak of though, enlighten me.
I'll confess that I haven't read much of the EU, and while the sequence of events is pretty good and is stayed too, the differences in characterization is simply ridiculous and the problem I think is that TCW and the recent Fate of the Jedi series is Lucas Ltd. trying to enforce some things in continuity which has made both of them a little weird. Also, as far as I'm concerned, a series that is controlled properly shouldn't HAVE to do a retcon every couple years to keep things consistent.
I'm talking about Mandolarian problem of 'are Mandalorians a warrior, somewhat mercenary culture that is values strength and are a bit violent perhaps but in general are people or are they a bunch of Mary Sues that are the paragons of the Galaxy. Or, are the Jedi powerful skilled warriors who are capable of doing incredible things and taking on lots of enemies just with the Force, or do they become completely incompetent if you take away their lightsabers.
Whether they're Mary Sues depends mostly on fans who don't like their current form and label them Mary Sues as an insult. They're mostly the former in your description. And Jedi are a mix of both. Your average Jedi is pretty powerful, but they have their weaknesses. Any examples of them being gods(TFU and the first Clone Wars cartoon) don't really count, with TFU falling under gameplay mechanics which aren't canon(Kyle Katarn can't really carry around 10 huge weapons at all times like he does in the Dark Forces games), or just general showiness(CW). I know some fans, myself included, have latched onto a minor character in one CW ep(the kid who saw Mace's Dantooine battle), who got a backstory that said he made Rebel Alliance propaganda during the Galactic Civil War, with the fan theory being that the crazy Jedi antics in that series are just propaganda in films the kid himself made, making that series fictional in-universe as well.
But I'm rambling. I like the Mandos, and Jedi are basically a mix of both. They can be damned near gods with the proper training, but do have their own weaknesses(including arrogance at their own abilities, leading to a general incompetence without the lightsabers they rely so much on).
My point in all of this is that there is a third reason for Jedi Power Levels fluctuating(and for Super Heroes abilities fluctuating):
The editors/publishers don't care enough to enforce at least some standards. Yes, point of view is important, and authors choose to focus on different things, and should be allowed to, and the necessities of making a video game fun to play are important as well, but if there isn't some kind of top down control then you get all kinds of discrepencies, not necessarily in events, but in characterization and attributes.
I am not saying that the Star Wars Expanded Universe and canon in general is as convoluted and contradictory as Star Trek's or Doctor Who's(or any number of comic book Universes) but there are far too many self-contradictions(that go way beyond an author choosing to focus on one thing or another, liking Mandalorians or Jedi or Sith or Fighter Pilots or the vagueriese of the Force and wanting to focus on them is one thing, making them THE preeminent Paragons(or baddasses, or whatever) of the Universe, as most author's involved in the Expanded Universe are guilty of doing, to one extent or another is completely different) and retcons and elaborate explanations needed to make all the characterizations that fit together for the EU to qualify as being well run and has unfortunately consigned their recent attempts at making it unified, with TCW and Fate of the Jedi being, in part, designed to unify various disperate stories, has turned out rather. . .weird, at least in part.
Honestly, the problem in all of this, as with everything Star Wars these days in George Lucas, who has a terrible habit with the EU of completely ignoring things up until the point where he all of a sudden is made to care about something and then he'll mandate a change. There are so many examples of this happening. I don't doubt that most of the editors/publishers as well as writers of the EU at least try to stay as much as possible within canon and there are certainly different emphases and focuses(although whoever picked the three writers for Legacy of the Force was an idiot as there might not be three more different writers in the entire EU than those three, that was just asking for problems).
Back to my point, all of these people are trying to a)tell their own stories and b)stay within the realm of canon. The problem is that George Lucas still has way to much direct control and basically ignores most developments until someone talks him into something or he realizes something isn't the way he wanted them to be, and then all of a sudden there is a top down edict that somethign most happen(or stop happening) or be a certain way. Sometimes it is due to him realizing something didn't fit in with his little view of the Universe(like despite Anakin Solo having been around for a long time, and Anakin being well established as Darth Vader's true name, the prequels made Lucas decide that Anakin Solo MUST be killed off to avoid confusion, despite them being very different characters, in different time period, and in different mediums) or sometimes someone talks him into something(as I understand happened with the Essential Atlas, the author essentially, somehow, persuaded Lucas to declare what was in the Atlas canon, despite him essentially just making things up for parts of it).
The Anakin Solo death thing bugged me. And the whole "no more Wookiee Jedi" thing just seemed random, and basically resulting in Lowbacca being trivialized afterward. Thankfully TOR seems to be allowed around the "no non-Red/Green/Blue sabers" rule.
Some kudos have to be given to GL for at times respecting the EU. Wookieepedia's article "List of C-canon elements in the films" is a nice start. Among other things, GL adopting Coruscant as the capital of the Galactic Republic(even if he already had the planet in concept, he took the EU name), and the name of the Twi'leks from the EU. GL seems to accept planet and species name without much fuss, since they can be looked up in a heartbeat and don't really infringe on any of his ideas of the saga.
I have no problems with The Essential Atlas being used by everyone, even those on top. If you look at the amount of work that went into it, going back 15+ years, and making a cohesive galaxy map out of things that seemingly contradicted(take for example the Mid Rim and Expansion Region being 'pinched' due to the Thrawn Trilogy putting Myrkr in the Inner Rim and Wayland in the Outer Rim, then also putting them a few light-years apart at most, thanks Timothy Zahn), and making it into one map that works. The Essential Atlas was the first SW book I've bought in years, and I heartily recommend it. EVERY world(over 4500 worlds) in the the 35 years of SW is in the Index(or the Online Index for worlds made after the book's release). You'd lose if you tried to play "Stump the Atlas". NOTHING was forgotten for the book. I can't hate anything made by what has to be the biggest SW geeks ever, which they'd have to be to have that amount of dedication.
Oh, certainly not everything GL has done is bad for the series, he created it after all. In fact I would personally compare George Lucas to an old fashioned Greek God(or Norse, or any of the old Pantheons). He does just about whatever he wants on a whim, some of it good, some of it bad, most of it baffling to mere human understanding, particularly on the reason why.
I've not read the Essential Atlas, and from what I've heard I will not question its thoroughness or detail. My point is that, I am told it has a fair amount of retcons, most minor, a few major and the reason these retcons are considered canon isn't because George Lucas felt there needed to be retcons or that George Lucas read the book and was impressed by the level of detail, but becaus the author talked him into it declaring it canon.
The Atlas doesn't really fall under canon to me. It's a reference book, with very little new fiction of its own. The authors never declared it canon. They just did a lot of work and put everything in the galaxy into places. TCW seems to recognize its placements(like Umbara in the Unknown Regions), and TOR does too(though Taris is farther out on the map than it is in the Atlas, being in the Mid Rim). It's just a nice neutral source to follow. Takes 2 seconds to look up any world, and doesn't hurt the episodes by having a world in the Inner Rim or Expansion Region or wherever.
Well, apparently it is all considered canon, for the moment anyway. The sad truth, however, is that for all he's done, creating it and all, I doubt very much there will ever be a stable canon to the Star Wars Universe while George Lucas lives, he simply likes tinkering too much and is too prone to random whims.
The question, therefore, is whether upon his death some controlling figure will step in and finally stabilize things or whether the absence of Lucas will irrevocably split the Universe, in a sense, between various people and groups who feel that canon should be their particular way.
I used to think GL wouldn't have any family take over, leaving his empire to a guy at Lucasfilm. But his daughter Katie has a done a lot of writing on TCW, so I could see her as the heir. But then again, I don't know if it'd be entirely terrible. Her TCW episodes tend to fit within lore(she's written every episode with the Nightsisters, which combined with Dathomir is a nice EU nod that doesn't clash too much with existing EU), and even when she deviates, it's not bad given that you'd expect the kids of the maker of SW to not care at all(Gene Roddenberry's son hated Trek until a few years after his dad's death, only coming into it in the late 90s/early 00s).
But I imagine Katie Lucas won't get to make any ass-random proclamations from on high since she wasn't around when GL made SW. But then again, TCW episodes are written by random guys who have nothing to do with the making of the original trilogy, and all episodes are still of the T-canon level that overrides the rest of the EU. Funny to think that the episode of TCW where C-3PO sat on some tiny people and got made their king is more canon than the Thrawn Trilogy.
(Also, there's a TCW topic on this board that I should probably bump so we can bring our discussion there. )
I like TCW on the whole, at least individual stories within it. I also like what they've done with the characterization, like making Anakin less annoying(but without actually changing the character), seeing Obi Wan evolve into being calmer and more controlled. However, I don't get the way they are airing it and some episodes, especially some of the stand alones are. . .weird. There are also some strange events and occurrences. It is a good series that highlights a lot about the Clone Wars. The problem is that it should have been aired in chronological order, which would have a much greater effect, especially on the characterization of things like Anakins slow slide to the Dark Side, and someone really should have thought better of some of the more off the wall episodes.