I've never heard of Thomas Ligotti before, so my interpretation may be different. I know that part of this was homage, but i couldn't but find a level of satire here. Most everyone who has attended college, even for a little while, has encountered that nihilistic, insecure man-boy who adores Nietzsche and sees the world as a decaying, festering mass. These men (boys?) are so transparent and predictable, so loathsome and yet pitiable.
What makes this story transcend satire and reach horror is the level of obsession. Every person has had their share of insecurities, and their own odd behaviors to compensate for said insecurities. As a writer myself, I couldn't help but empathize with the antihero's desire to attain greatness. I gazed into the abyss of his self-loathing, of his "never being enough", and I saw...me. That's what makes this story so effective. It's definitely a story by a writer, for other writers, but not so insulated that it excludes anyone else. The horror is subtle and lingering.
I only started listening to Pseudopod a few weeks ago, but this is one of my favorites so far!