I've got to say, I'm finding it pretty ominous that the vast majority of discussion in this thread seems to be about features. To me that's a bit like focussing on 'comedy westerns' in the Westerns discussion thread. Okay, okay, maybe not quite that disastrous, but I still think this is a field in which 80+% of the best work has been in short forms.
But I guess I should put my money where my mouth is, or rather my mouth where my mouth is, and discuss some of those overlooked masterpieces:
The Sinking of the Lusitania (McCay, 1918) - To the best of my knowledge, this is a singular film in the history of cinema: an animated newsreel. There were no cameras in the middle of the Atlantic to capture the tragedy, so McCay puts one there. It's an extraordinary idea, and it packs an emotional wallop, but what makes this so great is that it's a phenomenal and exquisite feat of animation: the images are beautiful yet awful (in both senses of the word). In purely technical terms, animation wouldn't catch up to McCay until Disney's height in the mid-thirties, and by that time it took a
factory of geniuses to do it. (This is on YouTube, but the copy I found was so hopelessly pixillated that it should be avoided.)
Screen Play (Purves, 1993) - And here's another amazing technical feat. Absolutely exquisite stop-motion animation that imagines a brilliant narrative grammar out of sliding screens and other moving parts. It looks like the most astonishing stage production you've ever seen (Robert Lepage, eat your heart out) and then. . . it leaves the stage. You can see it
on YouTube, so I won't spoil it for you.
Hotel E (Parn, 1991) - I've seen this political allegory several times on the big screen, and I'm still completely at a loss to understand what it's all about, except in the most general terms, but I always get swept up in the specificity of what's going on, and am always impressed by the startling stylistic juxtopositions within the film. The initial 'American Dream' segment alone would make my list in its own right, but enriched and complicated by the other material, it's even more hypnotically acidic.
YouTube.
Sing, Beast, Sing! (Newland, 1980) - Marv Newland will probably get in, if at all, with
Bambi Meets Godzilla, though that's more a brilliant idea than a brilliant piece of animation. This, for me, is the best International Rocketship film, a bizarrely hilarious juxtposition of the Toledo Mung Beast belting out Willie Mabon's Chess classic "I'm Mad" while his pal Black Ear the Dog drinks. The superb deadpan timing is enhanced by the patient, Tarkovskian lateral tracking shots and marvellous use of off-screen space (quite a rarity in animation, where the frame is very often the world).
YouTube.
The Hardest Button to Button (Gondry, 2003) - Like the best of Gondry's music videos, this is a fiendishly clever idea that's conceptually straightforward and self-explanatory, extremely difficult to pull off, perfectly suited to the music, and, in its execution, given far more expressive nuance than you'd expect. Those are all extremely rare talents for any filmmaker, and ones which tend not to translate well (or if they do, only fitfully) to features, which is why Gondry's music videos remain by far the strongest part of his oeuvre.
Enjoy.