I never got everyone's love of Eraserhead, which bored me to tears back in high school. (And it's not that I wasn't ready for the material; I was reading, and cannibalizing, Apollinaire and Daumal by tenth grade, Sartre in eleventh.) But I think you've hit the nail on the head:

What perhaps struck me most about Eraserhead—beyond the extraordinary, luminous texture of its cinematography; if David Lynch's directing were a prose style, I'd be re-reading him all night—was the absolute banality of its material.

I think it may be the balance to my oft-stated position that how something is presented is just as important (if not more) than what is presented; this corollary being that no matter how wonderfully you gussy something up, it's gotta have at least a skeleton to hang all the pretty things on. (I've been noticing this more and more in modern low-budget horror films, but never thought to connect it back to Eraserhead... which, now that I think about it, is a modern low-budget horror film...)

All that said, though, I should go back and give it another try, because there is no piece of film containing Jack Nance I have not been wowed by save this one, and back then I had no idea who Jack Nance was...