I just re-watched this for the second time on PS because I remembered liking the songs (although, admittedly I did not remember much else about the episode). It was actually better than I expected, even with all the good things I heard on the forum.
I do think they went into the plot a bit quickly; why would the Colonel just be standing there while SB and ST have been practicing for all of 30 seconds? But I though the song made up for it. Some people on the page thought "It's High Tide Time We Went on Tour" went on for too long but it was catchy, had some neat animation with visual puns (ie, the pair of Squidward and SpongeBob coming out of the pear) characterized Colonel Carper, and added some plot development with Mr. K. Although some rhymes were forced as they were in Atlantis Squarepantis, they were actually pretty funny (like the gurney guy suddenly getting up at SB/ST's magical tunes, and the 'fan' couplet). What I really didn't like was the ending; would it have killed the writers to have the fish actually like Squidward and SpongeBob's music after all of the misadventures they had throughout the episode? It felt like the whole plot of the episode was for nothing (at least music wise, as it is a music episode) at first. But then I realized that after it was revealed that the fish were just watching a meteor shower SB and ST were...smiling. They didn't know that nobody cared about their music, and I guess what the writers were trying to say is that it didn't matter whether the fish did or not (right Squidward?). The two didn't give up and created an awesome song. Squidward was even about to give SpongeBob a high five! I don't think something like that had happened since Enchanted Tiki Dreams when they and Patrick form a happy circle. So it really didn't bother me that much.
The plot was simple and I didn't find it dull, just like the old SB episodes. The things people had been saying about post-movie characterization (Mr. K the heartless thief, Patrick the insufferable moron, Squidward abuse, Spongebob being annoying and crying or screaming too much, etc.) were mostly averted. Mr. Krabs stole from Col. Carper and forced Squidward and Spongebob to give up a performance manager who actually knew what he was doing, but he got his line of comeuppance in the end. Patrick did very little speaking and therefore didn't get much of a chance to be an idiot. Eating the tire (and yes, I guessed that's what happened before Squidward even said it) was sort of annoying, but the writers did manage to create a good gag out of it and it was what led Squidward to run away before the final song. Squidward did fall over one two many Karmic Cactuses, but they didn't focus on his injuries so it was pretty funny slapstick. I liked the middle of the episode with the grocery instruments (I wish I could play the 99-cent pretzel!) and the "Too loud!" senior. Did you notice how Squidward reverted toward his older characterization? He's sarcastic, makes those unfunny puns, and actually cares about the Krusty Krab. Then there's, of course, the way he treats SB at the end.
This episode wasn't perfect, but it was very good and it managed to keep my attention the whole time. A stand-out special of Season 8, 9/10.