Playing cover songs is a sign of creative fatigue
For a more clear example of rock-recycling being the final nail in the coffin of career, look no further than Rage Against The Machine's 2000 cover album, Renegades. After nine years of recording some of the most viscerally charged political rock in history, Rage seemingly threw this album together as a contractual obligation, churning out ridiculously emblematic versions of classic rock hits like "Street Fighting Man" and "Maggies Farm" (though admittedly, their covers of Afrika Bambaataa's "Renegades of Funk" and EPMD's "I'm Housin" are pretty badass).
The fact that RATM decided to split up months before Renegades even hit the shelves was testament to both A) how much the band members sincerely hated each other, and B) that they were, at the very least, not very proud of the record they'd just finished. Thankfully, Rage's late-career blunder has become a half-remembered footnote in the band's otherwise impervious catalog.
While a creative stinker can ruin a band's reputation in the present, it rarely ruins their legacy. In 1970, Bob Dylan seemed to have completely fallen off the artistic wagon. Disillusioned with the counter-culture he'd created, it appeared as if Dylan were afraid to invent anything new, lest he create another Frankenstein that won't get off his lawn (as many hippies wouldn't).
First he retreated into the country-folk style of his younger days with John Wesley Harding, then he straight-up covered himself with the Johnny Cash duet of "Girl From The North Country," inevitably leading him to a bunch of weird renditions of mostly forgotten rock and pop songs on Self Portrait. In his review of the album in Rolling Stone, Greil Marcus wrote one of the most memorable opening lines in rock journalism: "What is this shit?"
Though this would only be the first of many creative dry spells followed by inspired bursts in Bob Dylan's career, to write him off then would be to write off the number of decent-to-amazing albums he'd make in the decades to come. An album of covers isn't even always a sign of a creative dip, as seen in David Bowie's 1973 tribute, Pin Ups, which is bracketed by some of the best work in his career.
It is nice to have exceptions like this, giving hope to our generation's sufferers of creative erectile dysfunction, who must now be propped up by the ghosts of rock in order to crawl into the 2010s. Perhaps Beck and the Flaming Lips will regain the ability to surprise us in the years to come -- but even if they don't, they've at least left behind some good albums for future generations to cover.