Definitely not overrated! I will admit my bias, as I own nearly every album of his, but you have to remember the times were different when he became famous.
He's not some mythical deity, like some people make him out to be, and he freely admits that, but he didn't win a Nobel prize for nothing. The man is an absolute legend and has written some of the most influential music of the last 60+ years.
I've can confirm that his live shows are awful. I saw him back in 2000 and it was really disappointing - his voice is completely shot and he looked so frail.