well, tea tree oil - the active ingredient in Melafix -really does have antiseptic and antifungal properties. people use it for treating small cuts (like a replacement for neosporin) and is included in some products to treat dandruff and athlete's foot, which are fungal problems. the bigger issue of whether it works or not is more based on the extent of the disease by the time treatment is started, and the concentration of oil used. like the neosporin, if you get a small cut and put it on right away, it will most likely prevent any further problems, but if you already have a raging infection and your finger is about to fall off, an over-the-counter antiseptic ointment isn't going to help anymore. there are limits, and a lot of the problems may be user error, but if it really does harm certain types of fish, that should be tested and reported.
i know i don't like to use pimafix in my main tank anymore because it does *something* to the clown plecos. usually they hide all the time and i'm lucky to see them, but when i use pimafix it's like they can't breathe well, so they come out and sit all the way at the top of the driftwood (2 foot deep tank, they climb up the wood to 6 inches below the surface of the water), and they breach for air as well.