Granted, it's a "fictionalized" Lovecraft insofar as the story is concerned, but one of their selling points, as I recall, was (and still is) that they are actually trying to capture the personality of Lovecraft himself as a character, rather than simply using an "alternate version" of HPL. That, by the way, has been done before, and with varying success. That in Cast a Deadly Spell had only a tangential relationship to the real Lovecraft (a bizarre sort of distant reflection of some of his opinions, his sometimes priggish attitude toward certain things, and his determination to be very much his own person rather than following the herd), but it is a wonderful character, nonetheless. That in H. P. Lovecraft's The Necronomicon was simply dreadful. That in the graphic novel Lovecraft varies between reasonably accurate and completely off, and is at those times a terribly simplistic and distorted version of the man. And it seems to be something much closer to these last two rather than the first (or the very accurate presentation of him in Out of Mind) which we are dealing with here.
As for the average person not being able to name a single story, etc.... I'm not so sure moviegoers are that ignorant of HPL any longer. There has been a plethora of films from studios and from independents in the theaters, straight-to-video (or DVD), and on the web, in recent years; numerous editions of his works are in print at present, usually going through several printings; references to him are made in films by people such as John Carpenter and Guillermo Del Toro (among others); several of the films based on his works which have been long unavailable are now once more being re-released on DVD; and there are copious numbers of videos, documentaries, and readings/adaptations of his works about him showing up on the internet, plus there is a new documentary coming out on DVD which has already garnered more than a little attention in a quite limited run in selected theaters. This doesn't even get into the number of comic books and graphic novel adaptations currently going on, or the ever-proliferating game scenarios based on his work. They may not have read Lovecraft, but most people who go to movies (or rent them) in any number are at least aware of him, and I doubt this film is likely to do any more than that.
So I'm afraid my reservations still stand. I wouldn't have an objection if they went for a completely "alternate reality" version of Lovecraft -- that would be legitimate, I suppose, though I might not like what they did with it. But... once they start claiming they know anything about the man, and have brought that to the work, and their statements indicate all they "know" are the same old hackneyed myths and legends which have been promulgated about him since shortly after his death in 1937... then I can't help but feel my gorge becoming buoyant. Again, I feel very strongly it is simply a case of a comics (and screen) writer simply not doing the workmanlike job of actually researching his subject, and that is something I find offensive with any writing which deals with an historical figure or situation. In Lovecraft's case it is simply more galling because of the incredibly easy availability of accurate information out there about him, a good deal of which could well furnish tons of ideas for imaginative, eerie, or even adventurous stories for anyone willing to put in the effort to be a teensy bit original, rather than going with the same tired old schtick.