so far I attended only the 2009-2010 german Gd. There were a lot of entries, but not overwhelming. Especially in the open/diorama categories.
No, quality varies wildly. There were some that were TTQ at best (and from gduk I heard, that some people use the GD-entry to get in earlier, so they take any 3 color mini, go in the door early and 'enter' it).
is it worth to attend for fun? yes it is. I tried my best, and while still knowing that at best I'd have a chance for finalist I entered.
It was important, so you see where you are and where you need to improve. It also teaches you some humbleness in case you are a top-dog in your city (I've spoken with people who were the best in their clubs/cities but still painted below TTQ, for them an entry there is enlightening).
sadly there is no chance that I'll ever get a GD, because I'm not really fond of GW's minis anymore --> nothing to enter. Also with the exception of GoldenDemon(+painting demos held by really good painters) I found the whole gamesday highly boring and because of the marketing going on somewhat repulsive.