I agree that this negative evaluation of pseudepigraphy is totally out of keeping with the attitude in Jewish (particularly, Essene) and Christian circles where such works circulated and were written. Just look at the library of scrolls from Qumran, which were bristling with books like Jubilees, 1 Enoch, the Testament of Levi, the Testament of Naphtali, the Vision of Amram, apocryphons attributed to Ezekiel, Jeremiah, and Elijah, the Vision of Jacob, the Testament of Kohath, and even more visions of Daniel. So the producers and readers of this literature did not necessarily consider these works frauds or forgeries -- these were indeed accepted as the true and genuine words of these old patriarchs and prophets, although it is certainly possible that some were recognized as first-person fiction and haggada as well.
If you actually examine them, you can see that they had more nuanced views on the matter. For example, the pseudepigraphal book of 4 Ezra, which depicts itself as written 30 years after the destruction of Jerusalem in 587 BC (3:1), portrays the entire Hebrew canon as written by Ezra through divine inspiration. Ezra bemoans the destruction of the original books in Nebuchadnezzar's burning of the city; they do not exist anymore. But God instructs Ezra to begin writing on tablets and "I will light in your heart the lamp of understanding, which shall not be put out until what you are about to write is finished" (14:25). And so Ezra begins writing and through his agency the books of old are rewritten. Ezra ends up producing 94 books, including all 24 books of the Hebrew canon (which curiously anticipates books that had not been written yet), along with 70 books that Ezra is to keep from public circulation -- these latter books are the apocypha and pseudepigrapha that are revealed only to the wise (v. 44-48).
This describes well how the pseudepigraphal writer viewed himself. He believed he was genuinely restoring or bringing back a book written in the past, revealed to him in a vision or under inspiration (which has an exegetical basis in Isaiah 29:11, 18, 24: "For you every vision has become the words of a sealed book ... the deaf, that day, will hear the words of the book ... erring spirits will learn wisdom and murmurers accept instruction"). It was a common motif in apocalyptic visions that an angel delivers a scroll to the seer, which contains the words that he is to copy down. This motif got its start in Ezekiel, where the prophet was instructed to eat a scroll containing the prophecy (2:1-3:11). Similarly, John relates the unsealing of a great scroll of prophecy in Revelation (ch. 5-8), as well as a small scroll which the prophet eats in a fashion similar to Ezekiel (10:8-11). Hermas, too, is given a "little scroll" in a vision and he "copied it down, letter by letter, for I could not make out the syllables" (Vision 2.5.4), then his copy is snatched away and read back to him in a later vision, wherein it made reference to "the book of Eldad and Modad, who prophesied to the people in the wilderness" (2.7.4). The Epistle of Enoch in 1 Enoch presents itself as a letter written by Enoch, the heavenly scribe, to those of the "latter generation" (92:1). Jubilees describes a dream vision of Jacob, in which an angel descended from heaven with seven tablets with (Enoch's?) prophecy of what would happen in all the ages (32:20-26; compare Enoch's continued writing in paradise in 4:23-24), which he is instructed to copy down. The common view is that what the writer copies is a book that has just become unsealed in the vision for the benefit of the writer (cf. the unsealing of the scrolls in Revelation). A good example of this can be found in the Damascus Document, which claims that there was another sealed book of the Law hidden inside the ark of the covenant (a midrashic interpretation of Deuteronomy 31:26-30) which was unknown to David and not "revealed until the sons of Zadok [i.e. the Essenes] arose" (5:1-6), and this is probably to be identified with the Temple Scroll (11QTemple). The Testament of Moses (= the Assumption of Moses, quoted in Jude) similarly interprets itself as one of the books that Moses deposited in a secret place in earthenware jars, to be revealed when the "day of recompense" draws near (1:16-18). Of course, it is an open question to what extent the authors really believed these rationales and what extent the latter were just literary devices.... did the authors really experience visions when they were writing? I suppose, as in the case of Revelation, that is a subjective question that remains open.
The pseudonymous character of Daniel should be evaluated by exactly the same criteria (and there are many) that apply to all the other books that share the same characteristics, whether canonical or noncanonical (like 1 Enoch, Jubilees, the Testaments of the Twelve Patriarchs, etc.). I would mention in passing that the author gives exactly the same internal plot device as these other pseudepigraphal books for explaining why no one had seen this prophecy of a long-dead prophet before its publication. Daniel is told in 8:26 "to keep the vision secret" and we read in 12:4, 9: "You, Daniel, must keep these words secret and the book sealed until the time of the end...These words are to remain secret and sealed until the time of the end". Of course, the book of Daniel is now no longer hidden and the author elsewhere indicates in ch. 8, 9, and 11 that he believed that the Maccabean crisis of the 160s BC was the "time of the end". This means that it was around 168-164 BC that the book appeared seemingly out of nowhere and circulated publically among the people. The book itself explains that the reason why no one had earlier seen this work is that it had been "sealed up" and "kept secret" until that time. The very fact that the work was now public indicated to the people that the time of the end was then at hand. Unfortunately, this plain sense of the text is often set aside by those who claim that it is the understanding of the prophecies that is kept sealed until the time of the end (thereby circumventing the difficulty of why the "end" did not come in the second century BC), but that is not what the text says and it misses the parallel of the same plot device used in other apocalyptic works. In fact, it is noteworthy that Revelation reverses this motif; John is instructed to "not seal up the book, for the time is close" (22:10). That is because the book was not pseudonymous but was written by a contemporary prophet for immediate release, for Jesus was "coming quickly" (v. 20).
