Villains too evil?

The Wounded Guardian was reviewed by The Adelaide Advertiser recently, which was a pretty complimentary review (four stars out of five) - although it threw in the comment that the villains were too evil.
That got me thinking - how evil should fantasy villains be? I mean, I don't remember anyone saying Sauron was a bit too nasty in The Lord Of The Rings, or that the Ringwraiths weren't cuddly enough.
There are few fantasy books where the villains are quite nice people really, just a little misunderstood.
Are we willing to accept that orcs/goblins/trolls/whatever are all utterly evil but that humans cannot be that bad?
If so, where do the likes of Hitler, Stalin, Mao and Pol Pot come?
When writing The Wounded Guardian, I had the difficulty of beginning with a compromised hero. Martil is derided as the Butcher of Bellic, a man with evil deeds to his name.
So if you imagine a scale between good and evil, he's kind of sitting in the middle. That meant any villains had to begin further down the scale than Martil - and keep going!
But I don't know if I'd class them as "totally'' evil, although I wanted the like of Duke Gello and the Fearpriest Onzalez to be very dark - they are men who are not bothered by conscience or morality. History is littered with such men.
But what do you think?
Can we believe in utterly evil non-human villains but human villains need to have some sort of redeeming feature?