Technically the word 微妙 means
as per WWWJDIC:
(adj-na,n) (1) delicate; subtle; sensitive; (2) difficult; delicate (situation); complicated; (3) doubtful; questionable; dicey;
However, last time I stayed in Tokyo ( about a year ago) most of my Japanese friends (about 25-30 years old) were using 微妙 to mean "kinda sucky" or "boring in an annoying way". I believe I remember a sentence like this:
海はどうだった? まあちょっと微妙。
How was the beach? Eh... it kinda sucked.
I also heard it used as an adverb with this meaning but I can't remember an example. When I asked my friends about it, they said they don't really use that word for positive things, though none of the numerous examples I saw on ALC had this slangy type of meaning. I guess the meaning of subtle mixed with dicey and then became "so either-or that it just sucks"? If anyone can explain the subtleties of this slang usage, I've been wondering for a while.
微妙
may have a slight positive nuance comparable to the Englishsubtle
. The negative nuance may arise due to the word being used as a euphemism so that you don't have to explicitly mention the negativeness, but it surely is not the primary meaning. I think Dave's answer describes this situation quite well. To mention the subtlety in things that are definitely positive as in art or meal that you mention,絶妙
will be an exact fit.