Recently re-watched, and contrary to posters here and over at CHUD, liked it better than back when it came out. While it’s still full of clunky dialogue and scenes that are unnecessarily sickly (just like the book), on reflection there seems to be a reason for that. tl;dr to follow..
The tortured Romantic style of it all is about the best thing going for it. The story is an Romantic tale, about how masculine identities & urban sociopolitics become entrapping, forcing young boys and men to sacrifice their individuality, hearts & minds for the sake of a larger military-industrial machine (the novel takes place in 1965, the year the Draft doubled its demand). It's a book about chivalry, the inevitability of human conflict when groups form, the ways in which emotional expression can sublimate violent impulse, and how feelings of passion, grief & rage overpower even the instinct to survive (as in the case of Dillon's character, who, tired of ekeing out a living, essentially lets police kill him).
Teens are maudlin by nature, one can't really expect much else from a teenaged author/protagonist. The prose does swing between fear and awe in sometimes nauseating & clumsy turns, but that befits the intuitive style of a teen, and of a Romantic protagonist with his horror of an encroaching entrance into a society that damns & condemns him to death or conformity. That doesn't excuse Coppola his direction, however. I suppose he realised later that he could have done better and so RUMBLE FISH came to be. Watching THE OUTSIDERS back, it seems Coppola for some reason fights his artistic instincts deliberately so he can produce a film in a formulaic way, and this could be why it rang so false with some audiences and why it got panned on release. Macchio once gave an interview confirming he was a fan of the book when he auditioned and that would have taken a part regardless of direction, but the rest of the cast have not admitted as much.
It's true that long descriptions of our heroes do make for an odd narrative, but it renders the text honest. Boys like the narrator often idolise other men irrespective of their sexual preferences, but are discouraged from giving voice to these feelings. It's not A CLOCKWORK ORANGE by any measure, but Ponyboy's memoirs lead the reader easily into the mindset of a boy moving in awe through the world of young 'Toughs'. Alternatively the book (and the movie, to lesser extent) can be read from the POV of a young gay boy who is only beginning to understand his feelings. Coppola probably read it this way, as his final cut makes strong cinematic suggestion that Ponyboy & Johnny are falling in love.
It's a mystery how they got it done, though. One retrospective/Making Of has it that Macchio and Howell didn't get along, as the much younger Howell (at just 14) wanted to play around on set and meet fans while Macchio (soon to be 21 years old) wanted to rehearse and run lines every spare second to impress his Director. Nevertheless, the two-hander scenes they have work well enough that Johnny visibly grows bolder in revealing his attraction & attachment over the final third (when he curls up to sleep on Pony or cuddles him by the fire they build). It's like the reverse of the campfire scene in MY OWN PRIVATE IDAHO - where Scott keeps his distance from Mike and laughs at his confession of attraction, Ponyboy silently accepts Johnny's affections and stays physically close to the other boy. There's certainly a case to say this is trite way to build a relationship on-screen, but to play Devil's Advocate, it may also be a rare earnestness playing out. That said, the decision to show Johnny’s last words lying charred on his hospital bed was overbearing.
