Simple explanations are good, but not necessarily correct.

Right, simpler explanations start with a higher probability of being correct. And if two explanations for the same data exist, you should assign a high chance to the one that is simpler.

It's awfully easy to say they're all nutcases, but it's still easy and a bit more fair to say that they're mostly nutcases but maybe some of them are correct. Maybe. I think it's best to give it a chance at least.

Why should one give "it a chance" and what does that mean? Note also that "nutcase" is an overly strong conclusion. Human reasoning and senses are deeply flawed, and very easy to have problems. That doesn't require nutcases. For example, I personally get sleep paralysis. When that occurs, I get to encounter all sorts of terrible things, demons, ghosts, aliens, the Borg, and occasionally strange tentacled things that would make Lovecraft's monsters look tame. None of those things exist- I have a minor sensory problem. The point of using something like schizophrenia is an example is that it is one of the most well-known explanations for the more extreme experiences or belief sets. But the general hypothesis that's relevant here isn't "nutcase" so much as "brain had a sensory or reasoning error, as they are wont to do."