Considering how many bands have such crappy songwriters, maybe it's just as well that they only do covers.
BTW, I'm exaggerating a wee bit. Yes, I have seen some great bands over the years that had great original material. Unfortunately, I've also seen a lot of bands who went for a rather generic sound because they could not do any better in terms of songwriting. Maybe for some bands, playing nothing but covers isn't such a bad thing. Keep in mind that the Beatles and Stones started as cover bands, and take a look at what they grew into. Not that I really think this sort of thing always happens.
BTW, Little Steven said something about this in a speech he delivered at SXSW, in which he stressed the importance of studying the songwriting of great bands so you'll become a better songwriter. Yes, I know some of you think LS is full of shit, and that's fine, but I just thought I'd bring that up.
Just my two cents.