Jeff, I agree with most of what you said on page 4--this is, in my opinion also--definitely the weakest novel of the witch series (including Equal Rites and all the Tiffany books).
Where I differ from you is not so much with your annoyances with the theatrical/operatic part of the novel, but with your statements about the witches (in point 3). I think, rather, that they are made (not very effectively by PTerry) to act very much true to form. In fact, in some ways this is the most revealing if unflattering portrait of the witches in any of the novels.
I still believe that the problem from which all the disconnects and apparently odd bits of behavior on the part of the witches comes from the fact that Terry cobbled together a book too quickly--and it shows. This isn't really a book about opera (or even musical comedy). It's a much more standard theme - the difference between illusion and reality, what being able to distinguish between them allows the witches to do. It incidentally allows them to expose a theif and rescue Walter, but so what. Finally, it gives Terry a chance to show us some of the least flattering characteristics of both Granny and Nanny.
I suspect that Terry saw Phantom of the Opera and that gave him an idea for a novel which in some ways in a parody of that work. (If one Ghost isn't enough, than two allows him all sorts of freedom.) I know that Tony thinks that Nanny wrote to book as part of a plan to get Granny out of a funk, and that she knows they'll end up going to AM because of the royalties she hasn't received. While that may possibly be true, Nanny has also published The Joye of Snacks under the pen name "A Lancre Witch" which (of course) gets Granny's goat in several ways. Granny certainly considers herself the first among equals of the Lancre Witches, and of course the mail generated by the book comes to her. And Nanny knows that this is the kind of book Granny disapproves of and certainly doesn't want it attributed to her.
But if PTerry is going to do a parody of Phantom, then he's got to get them to AM. And since Magrat has apparently withdrawn from the coven, they are in need of a third witch, and Agnes/Perdita has to be it. I suspect Terry thought he would G develop her character for later use. But he treated her very badly--all we really learn about her is that she's the kind of calm, competent witch who sees what's needed and does it (even though bringing Christine hot drinks, etc. isn't much). In some ways, she reminds me in that respect of Tiffany. Nor was I amused by the fact that Granny allows her to walk home from AM in the rain--exercise doesn't seem to have kept Pratchett from using "fat" jokes in CJ. We know she has both musical, and presumably magical talent--but not a great deal more.
So my conclusion is that the reason this is such a weak book is that Terry tried to do too much and jammed too many things in together when they really don't fit. The whole watch thing makes little sense. We meet Andre of the Cable Street Particulars--an undercover unit we never hear of again. Nor is it clear why he is there. Nobby & Detritus are supposed to be funny--but aren't. Granny and Nanny seem to me to be much more interested in scoring points off each other than anything else. Granny gets Nanny's royalties for her, and then they use the money to create the false Lady Esmeralda because as they both acknowledge--the only one who can play that role is Granny. Nanny gets Granny by serving the special desert (an attempt that doesn't really work on Granny or Enrico).
So, I still say that this book doesn't really work. For one thing, Granny and Nanny aren't challenged by evil in this book as they are in others, and the parody of opera and musical comedy gets very old very fast.
