Is it really though?
I don't know if I'm missing something but this episode, to me, feels like complete filler. Whenever I watch the episode, I get the feeling that Whedon just really wanted to do a ballet episode and that's it. If I compare it to I Only Have Eyes For You who has a lot of the same elements (ghost, tragedy without closure, etc.), it really pales in comparison. Maybe it's just me but I don't understand how I'm supposed to care about the ballerina and her lover and why Angel and Cordelia are reliving those moments. What made an episode like IOHEFY special and worth telling was the link that existed between James and Buffy and how it showed what was going on in Buffy's head/heart. The episode also dealt with Giles's grieving of Jenny which was something important going on with the character that we hadn't seen much of. This to me is an episode worth telling even if it seems like a filler. Waiting in the Wings just doesn't do any of that. It doesn't tell me anything I don't already know about the characters I love, it's just a whole bunch of romance angst without much meaning and I couldn't care less about the ghosts.
This episode does the same thing that 'IOHEFY' did, I think. It explores the characters' psyche in a similiar way.
The story of the ballerina parallels the story of Angel and Wesley - they wanted Cordelia/Fred (like the Ballerina wanted her lover), but they were afraid of what could happen if they went for it, so they hesitated (again, like the ballerina), and as a result, they lost their chance (like the ballerina) - Wesley lost Fred to Gunn, Angel lost Cordy to Groo, and the ballerina lost her chance for love and got trapped in an eternal loop.
There's also the element of the shadow self, the magician who created the loop: If Angel and Wesley would keep "waiting in the wings" for Cordelia and Fred, then they'd become pathetic monsters like the magician, who destroyed his life and the life of everyone around him because he couldn't move on from his unrequited love. They need to either approach the girl of their dreams directly, or let her go and move on. Both Angel and Wesley missed their chance in this episode, and so they both needed to move on (like the magician needed to move on, because the ballerina didn't love him) - but only one of them managed to do so. At the end of the episode, Angel manages to move on because he has Connor, but Wesley can't quite bring himself to do it - he remains bitter about losing Fred (he KEEPS waiting in the wings), and that bitternes plays a big part in the terrible mistakes that Wesley makes in the following episodes.
I think that one's reaction to the two episodes (IOHEFY and WITW) depends on one's reaction to the couples in these episodes - if you're invested in the story of Buffy and Angel, then you'd like the story of IOHEFY, and if you're invested in the story of Cordelia/Angel and Wesley/Fred, then you'd like WITW. I'm going to guess that you're NOT a fan of Cangel and/or Fresley (at least not in season 3), which is why you don't like WITW.