Lo-fi and the question of what's being lost versus gained relative to cleaner production is worth being specific about.

The things lo-fi recording loses: frequency response at the extremes, dynamic range, separation between instruments, clarity of lyrics. These are real losses. A clean recording lets you hear more of what's actually happening in the music.

The things lo-fi recording gains: physical presence (the room is in the recording), a specific warmth from tape saturation or limited bit depth, the sense that the music exists in a real space rather than a constructed one, the intimacy of a recording that wasn't polished for mass consumption.

The evaluation of whether a given lo-fi record is improved or diminished by its production quality is context-dependent. The question is whether the losses serve the music's goals better than what would be gained by clean recording. For some records, the answer is clearly yes. For others, the lo-fi is just underfunded studio work and clean production would be strictly better.