The worst movie I have seen in recent memory that wasn't a d grade film and should have been better was Cellular. Holy shit, Kim Basinger's acting in that was some of the worst I have ever seen. Shocker.
Another higher budget film that shouldn't have been so terrible was The Grudge (Hollywood version). Absolute SHIT. If you want to follow the success of The Ring by making a Hollywood version of a Japanese horror film, actually make it better than the original, not a million times worse.
Another shit heap film was Mortal Kombat: Annihilation. I thought the first film was fantastic, but this ridiculous sequel was absolutely terrible.
One I watch recently was called Demonlover, which had a mixture of French, Japanese and English dialogue. It sounded appealing, about a French firm that was in negotiations to get the rights to some Japanese Hentai films and dealt with the underground surrounding the industry. Don't be fooled, it was shithouse.