This is a really a tough one for me to rate, in that even though it lacks the sort of egregious flaws that normally prompt me to rate an episode lower than three stars, I’ve just never really liked it very much. Also, I’m conscious of the fact that there are quite a few fans who consider it to be quite good. This makes my reaction a minority one, but in regard to an episode about which I don’t feel particularly strongly one way or the other. (Dissenting from widely-held opinions is easier when that dissent is grounded in passionate convictions!) I suppose that, details aside, the episode’s main flaw is simply that it’s rather dull. The broad fundamentals of being an episode are carried off well enough, but the specifics of the story really lack something in flair, thematic interest, and (frankly) entertainment value (at least for me). Thus, while it’s not the sort of episode whose very existence as part of the series irks me, I never much feel like watching it, either—and for this reason, I’m calling it a two-star installment (while recognizing that this judgement may be even “more subjective” than usual).
I said that it doesn’t have a lot of major flaws, but—to be clear—it definitely does have flaws. For starters, the presence of an elderly couple on an otherwise devastated planet should be mysterious and intriguing, but I always have a hard time caring much about them or about the mystery; they’re portrayed in a reasonably skillful way in general, but they come across as so oblivious and indifferent to the surreality of their situation that it’s hard to get very emotionally involved. Basically, their manner makes it way too obvious right from the start that they are totally not what they appear to be. Also, while it’s not as badly handled as similar things have often been in past episodes, the brusqueness and hostility of the husband (“Kevin”) is overdone, and doesn’t help matters at all. For another thing, while the writers deserve credit for actually thinking to plug the potential “Troi should be able to sense that something is amiss” plot hole, the scenes of her freaking out over the incessant music in her head are way more annoying than entertaining (and Marina Sirtis’s acting is only partly to blame). Third, for a being of his power, Kevin’s efforts to chase off the Enterprise and keep its personnel from learning the truth seem pretty sad (and for that matter, one also wonders why he couldn’t have intervened in some non-violent manner against the Husnok when they attacked the planet). Finally, the manner in which the mystery of what is going on is ultimately solved—with Picard, for no apparent reason, three steps ahead of everyone else and doing all the deduction on his own—doesn’t work for me at all. The basic portrayal of Picard is as spot-on as in the previous two episodes, but his role in figuring out what’s going on is way too prominent. Where are the conferences with the senior staff, the input from the other characters, etc.? Why, on the one hand, does the obvious seem to elude everyone but Picard—and how, on the other, does Picard make the amazing deductive leaps that he makes about matters that are not obvious?
Beyond these plot and execution issues, there is a certain emptiness to the episode. It really isn’t a character piece of any kind, nor is its plot terribly riveting, nor is there any particular theme or moral. The revelation about the violence-abhorring “Douwd” having lashed out in anger and committed total genocide is both startling and provocative, but it would be considerably more so if we actually cared about him or were ever going to see him again. Since those things aren’t the case, though, I’m left with a bit of a “so what?” reaction. In terms of my categorization of TNG episodes by “story type,” this one falls into the “Encounter with a Weird Alien” category—which, perhaps tellingly, contains (thus far, at least) almost no episodes that I’ve rated higher than two stars. Moreover, what I was just saying about not caring about Kevin very much points, once again, to the problems inherent in stories that revolve entirely around one-shot guest characters rather than really being about “our” characters. In short, then, despite being pretty solid in terms of most of the broad elements of style and execution that continue to distinguish this season from the previous two, and not being ruined by anything too god-awful or glaringly dumb, this episode tells a story that just doesn’t do much for me—and that also needed some work in its execution.

I agree that just making the characters more aware of their situation and less oblivious would have gone a long way toward making this better. Also, what if Kevin’s wife had been actually real and he had saved her? That could have introduced some real drama to the situation as she found out what he really was and reacted like a real human would react to learning what this dude was guilty of. Explore that!
Also, they could have made the wife character the powerful alien, but it’s always a man.
If a major difference between a two and a three is the line between a story that is incoherent with some good ideas versus one that is coherent but kind of boring, I would call this coherent enough to get to a three for me. It is mostly dull and not very compellingly developed, I agree, but I think the thing that pushes me over the edge into “low three,” though, is the revelation that Kevin, a pacifist (who takes his philosophy to an extreme that frankly renders it ridiculous), wiped out an entire species in his rage. That’s kind of surprising and intense, even if it’s also underdeveloped.