Yo! I'm the ten year old kid that edited that definition from what was copied from the 8bc wiki (RIP). Before, it was basically the 'mario on a rave' shit.
I don't use it as a derogatory word (I'd call most of my own tracks fakebit) and I basically do just define it as any "chippy" songs made with VSTs and samples. I thought that was the popular definition but I guess I was wrong!
And that's how I understand and use it, too. A catch all word for emulation plus further stuff you can do in a DAW. I know it's used derogatory sometimes, but that's mainly because ye olde FLoops abuse that everyone groaned about on 8bc.
Yes there are bad programs out there - but, get a master programmer who cares in the helm and you are going to get something thats amazing (maybe its not there yet, but why pidgin-hole yourself), and i for one don't want to see that definition up there when that goes down. At some point these chips are going to die. If we want to preserve this music we better start emulating and stop discouraging the idea of emulation. It makes no sense.
In a way, I was abusing Wikipedia there to do exactly that. I removed the silly qualitative implications connected to the word which were in the original article and added a short description on the stylistic impact that the absence of hardware limits may have. Basically, I changed the definition to a purely technical term- as I honestly think it is. Wikipedia can work both ways; I thought if the scrubs look it up and see a definition like that the word might loose its derogatory implications over time. A wee bit of social engineering.
I guess for you it is something purely insulting. If you're reading that article and think 'Hey, that makes any emulated music shit' I can understand why you edited it, because I agree. The thing is, 'Fakebit' is terribly catchy, so I wanted to nab it for good 
Edit: By the way, most people on here seem to use it like me and ant1 understand it. If you look at the tag search, almost all tracks (tagged by the authors themselves) escape the floops-unce definition you think it implies. http://chipmusic.org/music#s=tag:fakebit
