I'm not sure what you mean here. I think it's OK, necessary even, for a director striving for greatness to take risks which sometimes don't pay off. It's also OK to produce a safe box-office success that lacks artistic greatness, in order to fund the more original works. So not every film of a great director has to be great. That's why I think you have to forgive them a few duff films. But after a long run of duff films you have to wonder what they are playing at, and whether they've lost it.
(What seems to happen, in this medium and others, is that a successful artist becomes uneditable. It's what happened to George Lucas, Tarantino, and may have happened to Cameron. Even great directors sometimes need to be told when to kill their darlings.)
It's not, but both were duff films in my opinion.
Both Titanic and Avatar are very heavy on the special effects. Avatar is also an action film. I don't like them because they are both simplistic and lack depth compared to the earlier films. Neither credits the audience with much intelligence.
Cameron seems to have been seduced by technology. His films have always pushed the technology forward, but he used to combine it with great stories. Both Titanic and Avatar have ground-breaking SFX, but now he seems to think he can slap in a formulaic love affair and 2D characters and a plot so mechanical it's predictable. The sad thing is that he's right; he's successful doing it and so has no motive to do more.
(Ironically, although I've seen Titanic it was also so forgettable (SFX aside) that I've largely forgotten it and so can't criticise it with the harsh detail it deserves.)
I guess he's an example of someone who tried to experiment with different things, that ultimately failed (for me), but I still credit him with trying and I look forward to Alice in Wonderland.
Although I do like TLotR as an adaptation, I give a lot of the credit to the co-writers rather than Jackson himself. This is partly because of the DVD commentaries which make it sound like they understood Tolkien so much better than he did. I saw King Kong and thought it was nothing special, and from what I've heard Lovely Bones isn't very good either. Movie-making is a collaborative affair, and I think sometimes directors get more credit than they deserve.