It became famous because at that point (and probably even still) going on guild raids had become boring, because every guild had "rules and regulations" on everything to equipment load out, long drawn out strategies, treasure allocation, heirarchies and what have you. Playing the game had become extremely boring and many felt had become a job unto itself.
The event (which was staged) made fun of such things, and the metagaming of the guilds. Hence, Leeroy Jenkins became the symbol of playing for the sake of fun, and ignoring the boring old "Maximize Treasure Reward Allocation" players.