For me, modern video game music is quite good, but it's a different beast from the olden days in one major way; short, hook-filled melodies.
What's always struck me about them thar olden days, was the way the 8-bit and 16-bit games often had their music handled. The composers knew the songs could only be so long due to memory space, and that the music would likely be repeating a lot throughout a given level. So, they seemed to work harder on making open-ended, memorable, and enjoyable melodies, harmonies, and such, with what little space they had available on the carts of the time (well, the good composers did anyway). They had to really focus on keeping the player interested with each 1-2 minute music loop, and that pressure vanished when memory space became less of a hurdle as time went on (both on PCs and consoles). Once space wasn't like a concrete barrier limitation anymore, the songs seemed to evolve into more "movie soundtrack"-like compositions, and left the short-hook melodies behind more often than not.
Now, that's not to say that newer game music doesn't have it's own familiar melodies (Halo's opening chant), that older games didn't also make "normal" structured songs (Master of Monsters), or that some modern games don't try to capture that hooky melody feel. But more often than not, the music back in the 8/16-bit eras were short, hook-filled, and the songs didn't really have a real beginning or end a lot of times. They just looped forever. And it's that shortened quality, and open endedness, that seems to inspire people more. Yeah, nostalgia plays a role too, as the idea of remixing the game tunes you grew up with is quite appealing. But I really do think that the compositional shift I mentioned also affected the remixing possibilities in a small way.
With older game tunes, there's room to make those familiar melodies and hooks grow and expand in new ways, without leaving them behind. You can take a one minute loop, and change it so that it's familiar, but different, as the song progresses. That's a very different trait to play with when compared to remixing a four minute song that doesn't really repeat throughout its duration. And I think more people are just drawn to the so-called "growing loop" idea I described. I know I am.
I know people will disagree with me, but that's my take on it.
And I do remix newer VGM. I just did a remix of Trine's "Crystal Caverns" for the seventh volume of An OverClocked Christmas (which you can hear right here).