I made this comment.
Excellent post. I'd never heard the term Mary Sue before, but I've long noticed the wish-fulfillment aspect of fiction. The first time it really hit me was while reading John Fowles's Mantissa.
I'm suspecting some sexism in some applications of this concept, because it seems to me that there's a fine and mighty tradition of male authors writing heroic characters who influence the world beyond what seems likely for most people, and people seem to accept that as normal. But now that we have women writing such things (e.g., Laurell Hamilton), it's a bit more eyebrow-raising, eh? (I'm not suggesting that's the only angle on the Mary Sue phenomenon, but...)