Well, I for one never took any sophomore or junior level economics courses (I am sure most of the population of the world has not either). Can I take it that you are an Economics Major or graduate, or perhaps the equivalent in another major? Right now I am reading a PDF that I take it is written at that level covering fractional reserve banking, amongst other topics. I think you are asking as a person whose perspective is one of knowledge and wants to be treated as such.
I would say first off there are quite a number of really bad and contradictory videos on the Internet, as well as articles and such. Before I found "Modern Money Mechanics", I had, as far as I can tell, no reliable, in the sense of authoritative, information to go on. I have an even better source now in many ways, but the more I look into it, the more I realise there is to know. psionl0 helped me out on at least two of my own misunderstandings of the subject.
You asked, "is it people not being used to thinking in economic models?", no, I think one problem is, it is thinking in terms of any kind of mathematical model at all. The most mathematics people usually are required to do is addition, subtraction and multiplication, to balance their chequebook for instance. I hear people sometime talk about the money multiplier. People get it wrong so often it is painful to me. They say obviously wrong things like "then the bank multiplies the amount of money by 10..."
As for the good and bad and then arguing over mechanics. I guess I should tell you my story when it comes to economics. I took a freshman level economics course once. I really did not like it. There was something odd in the way the topic was arranged it seemed to me. Being a physics major, I expected to see some graphs every so often with error bars, realistic units, data based on real world examples, that sort of thing. I never saw that. It was just made up graph after made up graph.
I noticed once my professor was comparing a derivative rate to an average rate and coming to various conclusions (like comparing speed versus velocity, wrong!). After that I also noticed that there was this sing-songy like way about how the answers on tests were supposed to be done. You remember which story to tell in response to which type of question and then fill in the pieces by rote and a little ingenuity. So I seriously started to suspect the intellectual legitimacy of Economics. It looked like to me for many of the things covered in my microecon class, like the Economists just stole a bunch of equilibrium thermodynamics ideas from the physicists and wrapped it up in terms like marginal, elastic, etc.
That is when I found out about Steve Keen. I still have not read his book "Debunking Economics", but reading his online articles I could see for sure Economics was a seriously ill profession. The equivalent of an intellectual dead end (Neoclassical Economics that is). After that, hmmm, well, I eventually read about Henry George. Read Zarlenga's tome of a book. Just reading and reading. Keen's new book is out next month and I can not wait to read it. I get the feeling like I will get the equivalent of an overview of economics undergrad education, all the while showing why it is nonsense. Another missing piece as it were in my knowledge about economics.
On the "good versus bad and then wanting to understand mechanics" theme even more, it is an interesting observation. I think people often make the mistake of confusing normative questions with logical questions. People want to go as fast as possible to whether something is good or bad, evil or nice. They do not want to take the time to assess the situation. I think in many cases you can not know if something is good or bad until you really understand how it works.
Fractional Reserve Banking is that way. For myself, I really just want to understand how it works, and then when I do, I will think about the good and the bad and leave it at that.
So Startz, is the mathematics me and psionl0 been doing in regard to FRB correct, as far as you can tell?
Oh yeah, to me there is nothing very mysterious about for instance Special Relativity, but man do people royally screw up on the ideas in SR often. My guess is it is a very similar phenomena going on.
Hope that answered your question and then some!
Show me the beef Sceptic-PK! 
to actually commit to numbers and rational explanations.
