I've always been suspicious of de Man. That said, I've also always tried to give him a fair shake. You never should dismiss any thinker outright. Part of the problem, though, is that de Man takes a lot of your good will and puts it into his service. It's the common practice of a cynic, of course--not too hard to get around (though it takes John Guillory some time). But you have to be vigilant.
Part of the appeal of de Man is not so much his aphoristic language, but the modernism of his postmodernism--as Jameson has rightly put it. Everything is tightly worked out to fold back onto itself, in a perfect self-perpetuating form in which you are... now not in control. On another level, it's also the appeal of a system: with de Man, you can put away all the considerations that have to come from context, and just ram a text through the system. Oh yes, you have to pay very close attention, work through all sorts of problems--but that's made a part of the system too, insofar as it is what the system accounts for as an act of "reading" irreducible to the system.
Regardless, it's a significant and influential appropriation of Derrida--so influential that American philosophers confronting Derrida might still not have encountered the more (I hesitate to say original) French-Algerian article (one can often tell by their reference to Derrida's overintense focus on language... the latter being a primarily de Manian preoccupation).
I'm only realizing now that I'm a little outside that circuit--having never quite been in on the de Man sort of deconstruction, whenever I encounter it I just feel odd. But I think the important thing to stress is that it wasn't a "misappropriation" (something de Manians love to get all moralistic about) so much as a powerful coordination of all sorts of concerns, a lot of them political (and even the desire to be apolitical is quite political) and having to do with the state of the university and the English department (particularly Yale's department, which never was consolidated into an actual department like in other schools) at the time. It is also something we can sort of ignore or put by, while we try and cultivate some completely new sense of how to relate Derrida to the reading of literature. We can't let the dour de Manian, or for that matter the Derridian, stop that project, especially with his system.
That said, we have to learn to extract what we can from de Man, I think. And there is a lot that is useful here. Some of the following posts try and bring these elements out, while combatting what is the desperate sort of attempt of de Man to make literature both relevant and irrelevant at the same time:
Prior to a Hermeneutics and a History: I try to focus on what is good and anti-hermeneutic about this de Manian proposition--written for a class with Peter Brooks.
Theory, Pedagogy, de Man: A look at de Man's remark, "the resistance to theory is itself theoretical," and why this sort of aphoristic tendency of his produces a sketchy "pedagogical" situation--that is a situation sketchy insofar as we insist on its supposedly pedagogical nature.
Demystifying the Singular: Consolidating the critique, by looking at more dangerous lines in "Criticism and Crisis." There's a long exchange in the comments where I try to defend my views and distinguish de Man from Derrida (a task well-accomplished by Gasché, but I try and do it in a more holistic sort of way). One thing I didn't emphasize enough in this exchange is that de Man truly thinks the origin of the language of the sciences are "literary," and that this is insane. Now, it's not insane insofar as it engages an issue involved in literary studies all the way back to Richards and his rejoiners to C.P. Snow. It's insane insofar as it encroaches on articulating a sort of metaphysics of the letter--which many people still attribute to Derrida himself.
Giving Up Deconstruction: Not where I give up deconstruction, but where I reflect on many people being dissatisfied with just this sort of de Manian metaphysics of the letter (this is a sort of sequel to "Demystifying"). I use Frances Ferguson's excellent situation of this problem in terms of 18th century aesthetics and the role of Kant.
Blindness: I read "The Rhetoric of Blindness" and try and sum up the differences between Derrida and de Man that I've been articulating in "Demystifying" and "Giving Up." What's sort of amazing is how hard this is to do in literary terms, when philosophically it is extremely clear what these differences are... something that shows why new and more sophisticated interpretations of Derrida in America usually come from philosophy departments. This, however, isn't a sign that Derrida was really a philosopher all along--or that the new Derrida is actually more correct than the previous Derrida (the fact that many of these philosophers worked in Comp Lit. shows their knowledge of Derrida is impossible without the literary emphasis). Indeed I claim elsewhere that philosophy will never quite grasp Derrida without going back to the literary-critical concern. What this means though is that the de Manian approach pulls Derrida too quickly towards reading an individual literary object. Other literary approaches to Derrida--like that of Geoffrey Hartman--can often be deeper.
Blindness, part 2: One last word on the issue.
Predicaments: Looking a little closer at how people get de Man out of certain binds.
Reading and Society: Here I consider the de Manian drive to separate literature from any significant social context by way of a simplistic reduction of these contexts to the Barthesian "codes." The apolitical tendency of de Manian deconstruction is quite apparent here: society and politics has to somehow come only out of the literariness of the literary--nowhere else. All one has to do to oppose this is say that a social context is not the same thing as a Barthesian code. Insofar as the code is inadequate, however, de Man's critique is actually quite welcome.
Derrida, de Man, Materialism: In the last post I'll collect here I critique de Manian materialism and Derrida's weird insistence that he is asserting something similar to de Man on this issue. Indeed, I critique Derrida's buddying-up with de Man in general--I simply think they're on completely different pages, except in their shared high-modernist temperament. More specifically, I make the case for considering Derrida as more of an idealist than a materialist--with one important caveat: this is only really valid insofar as it is just a sort of heuristic. Nevertheless, I think it is helpful to combat the increasingly meaningless postmodern insistence on the "materiality" of the letter (and which Derrida himself critiqued extensively in his writings on Lacan). The trace, it is true, isn't ideal. But conceiving it as the effect of idealization--well, that's what Derrida's very first books lay out. It's important to retain that connection, and understand that it therefore forces a rethinking of materiality--one that makes the latter something completely different from anything de Man is insisting upon.