You have a good point! But I think it misses, slightly.
Part of the terror of Cthulhu is that this entity is unfathomably OLD, unfathomably POWERFUL, and has unfathomable MOTIVATIONS. It isn't just a terrible creature: it's very existence occupies a plane that we can't possibly understand: it is inscrutable in every way.
And Lovecraft's contribution to horror was that this quality, specifically, possesses a unique element of terror all its own.
It's almost as if a lot of the people who are really into Lovecraft or are out to use Lovecraftian influences kind of miss the greater concept and just end up falling on, "Yeah. Squid monster. Also he drives you insane. Got some neat language to use on that latter bit."
I really like a lot of Lovecraft books, in the same way I like Le Carré's spy novels: they mix the mundane in with the action to build suspense and pacing.
If it was all crazy all the time it would be boring. Compare Reanimator the schlocky b movie to the story its based on: the original story has much more poignant commentary about death in war and missing fallen soldiers when back home. The b movie is just sensationalism.
However, I also recognize that a lot of it was inspired by his racism. The cult of cthulu is likely a metaphor for interracial marriage, and the squid-human hybrids are a warning against (quelle horreur!) mixed race babies.
Jokes on you HP Lovecraft, you didn't imagine people would actively want people to bang fish people but that was a god damn Oscar winning film in 2017. Then again he wasn't very keen on even normal people mixing their races...
Besides the squid-faced dude we all love and adore, wasn’t Cthulhu just the embodiment of idea that some fates are inevitable, no matter how hard we try to avoid them?