It really depends on what your building. Are you building a B2B application targeting IT departments? Design doesn't matter as long as it's logical and functional. Building a consumer app? In that case, design is much more important.
What about Craigslist? Is Craigslist a special case?
Craigslist is the only exception I know of.
how about reddit?
Don't confuse simplicity with poor design. Or, to rephrase that as a question: what aspect(s) of Reddit do you feel are poorly designed?
How is Reddit simple? By my count they have 40+ navigational buttons on the main pages and each story has 6 buttons (in one form or another) [1]. Reddit absolutely overwhelms me with places to click and gives me no sense of it being nicely organized (as opposed to Craigslist which I think feels very orderly). Amazon feels a lot like reddit to me, but I mostly only need to use Amazon's search bar, so it's ok.
Reddit is certainly not a design with simplicity in mind. The sheer amount of links and navigation in general is completely overwhelming. I'd say it's rather a poor design.
You need to distinguish design as an aesthetic from functional design.From a functional point of view reddit is a well designed site.In an ideal world of course they would be congruent but which is more important to get right first depends on what field you are in and who your customers are.
... and hacker news apparently :-)
I think Craigslist is a special case because it's in a chicken-and-egg market. I personally hate using Craigslist because of their poor design, though I've heard rumblings that they're going to change that.
I like the Craigslist design. It is simple and easy to use.