There’s a few reasons for this. There are the obvious “cheap” things, like the fact that you can’t see scalp in any of the wigs, either because there’s no part or because the weave pattern, which is always a dead giveaway. They’re too voluminous, which isn’t realistic. Or they’re chignons that don’t match color or texture. But it’s much deeper than that.
Coloring is a major thing. In Lord of the Rings, you may not even know some characters are wearing wigs at first because they match the actor’s coloring so well. That doesn’t necessarily mean it’s the actor’s actual hair color — Merry and Pippin don’t have the same hair color as their actors and Legolas is wildly different — but the costumers matched their wigs to their skin tone enough that it looks natural. This means that when Aragorn’s beard starts to grow in, it doesn’t break immersion because the stubble and wig match, and Legolas’s dark eyebrows actually work because his head hair has those brownish undertones. Geralt’s isn’t great for that.
Another part of the coloring is the undertones and highlights. Legolas’s wig, for example, changes from a silvery blonde to a golden to something almost brown depending on the lighting. That’s because the individual sections have been dyed to give a natural looking hair, which hasn’t been done in HotD save on Viserys (whose wig, imo, looks best). I would say Gandalf’s wig in the second film looks worst precisely because of the lack of undertones. I understand it was a choice to distance him from “the Grey,” but that doesn’t mean it looks good, and when his hair is tossed back and you can see the darker tones around his ears, it looks better.
There was also so much digital color grading that details could be smoothed out. The bleachy blonde wigs accompanied elves and wizards, so they got a different color grading that made them look less plastic. The hobbits were almost always warmed up, which integrated their orange-toned wigs better. Aragorn’s greasy, matted wig, is almost always darkerened, so we don’t see the texture as much, while his Rivendell & Coronation wig(s) coloration is practically chestnut. It’s the same color of hair, but the grading buys grace when it’s needed. (I think it was instinctual on the parts of the effects team; I haven’t seen a team do better, and even the Hobbit trilogy lacks some of the skill when it comes to character coloring.)
Another thing is that the textures are better. The dwarves almost exclusively had yak hair. Horse hair was used for smoother wigs. It gives a realistic texture and shine that you can’t get from synthetics — it also picks up dirt in a more realistic way than, say, Geralt’s.
Plus, everyone in Lord of the Rings is wearing a wig. Everyone. This means you don’t notice when there’s discrepancy between the hair of one character wearing a wig and a character not wearing a wig. The one scene where a character isn’t wearing a wig — when Bilbo is telling the story about the trolls and Peter Jackson’s kids are there listening — you can tell a difference between the wig and real hair, even if you don’t know what you’re looking at. Because everyone is wearing a wig, you don’t notice. Go through the wig photos and they don’t look all that bad… until they’re screencaps with non-wigged actors. Most shows do hair and makeup tests with single actors, maybe with two characters if they’re going to have a lot of screen time together, but are testing them against minor characters that don’t have wigs? Probably not. And that’s where it shows.
Another thing is that there’s more to it than just wigs. In LotR, Legolas’s contacts are inconsistently worn and the blue they are is very understated, matching his coloring. In the Hobbit trilogy, the contacts are aggressively blue and worn all the time and it’s really bad, particularly with the eyeliner. And it makes the wig look worse. Geralt’s hair looks much less like a wig when distance or shadow or digital editing is obscuring his fake looking eye color. Makeup can definitely change things; I mentioned Legolas’s eyeliner before, but also Cersi’s wigs look bad whenever the makeup department goes heavy on her eyebrows (so all of season 8). The costuming can be important — Daemon looks worse than other wig-wearers because all cool tones the costumers chose doesn’t offset the platinum wig tones, while the reds and golds other Targaryens wear does (not great, but better). The Witcher has, surprisingly, the opposite problem. The black leather armor is too bright and richly colored and the wig looks better both when Geralt wears cloth that’s less saturated and shiny (i.e., not his armor).
So there’s a lot of reasons, but mostly it comes down to bad design, cost-cutting, and a demand for turnaround that’s too fast for quality. Lord of the Rings was in pre-production for as much as two years (depending on your definition). Most movies have six months, max. TV shows may have as little as six weeks because they continue to write week by week and often have a mid-season break. You cannot create Lord of the Rings quality on a Netflix schedule.
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