Yup. That's why he'll continue to get work. He's not a horrible director technically, and even his bad films have some great visuals/shots. The problem has always been that he's not a good writer, especially when it comes to dialogue. Sixth Sense and Unbreakable are very good IMO but even those films have some puzzling dialogue lines if you rewatch them.
I used to be a pretty big M Night fanboy, and when I first found out about The Village it became an obsession of mine. I carefully followed the production and any bit of info I could find online; and I remember watching that lol-worth SyFy channel special. It looked like it would be a fucking awesome movie, and I was bitterly disappointed when I left the theater; it has some great moments, and I like how he brings the town alive, but ultimately the BAD dialogue and shitty ending ruin it.
About a year later I went to see some movie, and The Lady In The Water teaser played during the previews. Nearly everyone in the audience groaned the minute M Night's name appeared on screen. His films may be making money, but he has lost a stunning amount of respect/mindshare over the years.
(also I've heard he's a complete asshole in person, and a lot of people hate his guts)