I don't think the concept of the project is the problem. I'm skeptical that
an "Uncommons" project built around fair use could be workable, considering
that the validity of a fair use claim is context-specific and no cross-wiki
project (like Commons) is going to have an easy time managing that
requirement.
The problem is the behavior of a certain core set of Commons admins; time
and time and time again we have it reported here, we see it on Commons.
While not lawyers, they attempt to be extraordinarily demanding when it
comes to "legal" accuracy. Far more than the actual WMF lawyers have
required, incidentally.
It's not surprising that the locus of the dispute often revolves around
community members who have been banned on other projects but reached
positions of authority on Commons. Perhaps Commons social structures
haven't evolved enough to deal with people who are both productive and
deeply disruptive, and who are not uncivil but contribute to a toxic
environment.