Gatsby was an Ideal of himself (Gatz). He is the manifestation of the American Dream. He is literally a self-made man. He invented his personality. He comes from a small town and has little money, working his way through school as a janitor. He befriends a rich man, Cody, and views him as a mentor. He falls in love with Daisy and vows to become wealthy to win her. When that fails, he buys the mansion across the bay and becomes the socialite in hopes that he and Daisy will one day cross paths. Gatsby gets involved with a drug/bootlegging man, Wolfsheim and does whatever it takes to pursue this dream. Gatsby is in idealization of a man (Gatz) that Nick can relate to. Gatsby forsakes everything for the pursuit of this dream (Daisy). This is inherently selfish and people get hurt because of it. But Nick also sees the tragedy of it because Gatsby is still that naïve kid from a small town, like Nick. Nick can’t agree with Gatsby’s crime ring or his general false self and initially, Nick thinks Gatsby is nothing more than a superficial party-thrower, catering to the aristocratic, thoughtless elite. But Nick does admire Gatsby’s audacity in pursuit of his dream when he realizes all this superficial party-throwing is just a means to the end that is getting Daisy back.
Gatsby is great because he’s not real. It may be infatuation and it may be love. Gatsby is great because Gatz was willing to change his entire persona and alter his life in the hopes that he would run into the woman he loves, who is already married. What are the odds that he would run into her without Nick’s help? What are the odds that she would agree to take him back? She is already married. Gatsby defies these odds . . . for a while. Gatsby is selfish because his actions have dire consequences but his idealism, romanticism and determination against these odds is admirable.
Nick says Gatsby is "better than the whole rotten bunch" because that rotten bunch, the party-goers, only do things for their own status or gratification. Gatsby's simplicity in doing everything for love is what endears him to Nick.