Wow, TKindred, way to lump everything up into a generalization when you clearly haven't read much of any of it. Kind of pathetic. really. I could give you a long list of historical fiction that is, how did you put it? Oh, yes, "mind-numbingly hopeless trash." But I suspect you're just trolling.
When did The Iliad become fantasy? When it was composed. Homer was making most of it up, and knew it, because he (and the later reciters who obviously enhanced it) wanted to butter up a rich audience with assertions that "oh, why, yes, your great-great-grandpappy was a hero, too, and beloved of the gods, oh, why thank you for that gift of gold, and I must say you are the spitting image of your heroic forebear," yadda-yadda kiss-up kiss-up. Are you under the impression that Homer thought everything he said actually happened? Oh, the war, sure, and the general story, yes, even godly interest, but sea serpents? Apparitions? Etc., etc.. Pure bunkum, and Homer knew it. But gotta give the crowd what they want, right? So yes, it was fantasy then and it's fantasy now.
Here are some other works that are, in fact, fantasy:
Shakespeare's plays, specifically Hamlet, Macbeth, A Midsummer Night's Dream, and The Tempest. Ghosts, witches, fairies, and a wizard.
Marlowe's Doctor Faustus.
Spenser's The Faerie Queen
Malory's Le Morte d'Arthur
And most other medieval lays, including my namesake "novel" by Wolfram Von Eschenbach, Parzival. All fantasy, and knowingly created as such by their authors. (And, yes, you can get a lot of good wargaming ideas from them).
Tennyson's Idylls of the King
Good grief, man, you simply do not know what you are typing about!
As for those books actually called novels Lord Dunsany's The King of Elfland's Daughter, E.R. Eddison's The Worm Ouroborous are masterpieces, and far from "trash."
Tell me, is T.H. White's The Once and Future King "mind-numbing trash?" If it is to you, trust me, it's not the book that has numbed your mind.
Yes, there are bad works of fantasy, particularly popular fantasy. But that's true of every genre. Sturgeon's Law applies.
For more modern works worthy of consideration as quality, I would point you to Tim Power's The Drawing of the Dark, Megan Whalen Turner's Eugenides series (aka The Thief series), almost anything by Terry Pratchett, and Mary Stewart's Arthurian trilogy.
Oh, and some chap named Tolkien.
Now, for wargaming fantasy, I'll nominate the not-on-this-list-but-ought-to-be Brandon Sanderson. His recent works The Way of Kings and Words of Radiance are startlingly original in setting and concept, and his examination of the true qualities of leadership should be a must-read for would be military officers (and heck, politicians). If you expect men to risk their lives at your word, you'd best demonstrate that you will risk your life for them. Which is a pretty powerful message to come out of a fantasy novel!
I will close by saying that most of the selections on this list aren't my cup of tea. But that's because my personal taste is different, not because the suggestions do not have merit in and of themselves. There are plenty of very literary authors whose works I don't like; that doesn't make those works any less literary.