I admit that I was unhappy with it, too, but I think I now understand it better. I don't think that graphs help, because one of the most confusing things is the issue of time frame.
I think of Clark's Malthusianism as describing humans as a herd grazing on a meadow. When the herd is thinned, by disease or war, the remaining beasts have more on which to graze. That's the "bad is good" story.
A bad year for grass (the bad harvest scenario) starves a lot of the herd, which is bad. But then next year, when grass is back to normal, the survivors eat well because of the thinner herd.
So the time frame is an issue. Yes, bad things are bad in the very short run. But then there is an adjustment process back to the Malthusian subsistence equilibrium. And it is during that adjustment process that the "bad is good" story comes into play.
Interestingly, technological change is not good in either the short run or the long run. It moves so slowly that all it does is allow for more population to live at subsistence. But then we hit the Industrial Revolution, and technology finally starts to out-pace population.