I think that John peaked in form, budget, and cast with Hairspray (and I had already seen all of his films made up to that point when it came out).
I still see his new films and like some elements of them, but they can be too campy or too low budget. I wouldn't say that Hairspray is my "favorite" John Waters movie (I like some of the earlier movies better) but it is his most accessible and professional.
Others are doing the campy movies better these days and he's be entirely ripped off in the gross out humor arena by Hollywood.
He has few tricks still to spring.
But I think that John Waters did the "gross-out" thing better than the current "Farrelly Brothers"-style band o' idiots are.
My favorite John Waters movie has got to be "Serial Mom". For a year after watching that movie, I wanted Kathleen Turner to be my mother SO badly! I had visions of her knocking off the bullies in my class one by one, each in their own cruel little way.
... and then I switch over to Tim Burton's "The Nightmare Before Christmas" to make me feel sweet again.