While I think AGT is a fantastic episode, it's not my favorite since it basically treated Picard as the only thing in TNG that matters and that he's the only character to actually develop. I like two parter/feature length episodes better when the other characters have more stakes in the story rather than simply serving to further only Picard's story.
Plus episodes like BOBW and COC helped bring long term changes to Star Trek in ways both subtle and huge. Starfleet would be more militarized due to the Borg invasion and Troi would now have to look professional by wearing a uniform.
And while I wholeheartedly agree that Shelby's character didn't really pay off well, she wasn't put down as the typical rival character who is always wrong because she's not the main character. Hearing Jonathan Frakes say that they didn't use enough of her was nailed right on the head because even in TNG's later seasons, the female characters didn't really amount to much. Plus I thought her quick dismissal from the Enterprise in the end was a bit too happy. I will forever curse Ron D. Moore for making the comment that he never work with her character again.