I found myself watching the destruction of Muta at Starrcade ‘89 and it got me wondering- what were the best and worst booked tournaments you’ve ever seen?  It begs the follow up question: can you have subpar talent and still book your way into an entertaining tournament?

Sure, they did it at Survivor Series 98!  That's probably an example of the best-booked tournament with some of the worst talent.
I'd say WM4 was actually a pretty well-booked tournament, too, despite another stinker of a field in a lot of ways.  King of the Ring 93 was really good, playing to Bret's strengths as a worker and telling a good story.  Plus it was a good range of talent and stars for the time.
Worst has gotta be King of the Ring 95.  Fuck finishes galore, terrible field, all the wrong people winning, you name it.  That or the Mid-South TV title tournament we covered when I was still doing those reviews, which ended with Snowman winning despite not being in the territory when the tournament started, after a weeks-long complex tournament where they literally had to explain the rules on a white board each week.  Really bad stuff.