Peter Jackson did a lot of schlock before he made it so to speak. One of his earlier movies was about fast food aliens harvesting the human race for Burger meat, in which he played one of the lead characters who had to tie his skull back together to keep his brains from oozing out while he laid waste to alien scum.

So yeah the real question isn't how is it that the man who did Lord of the Rings made this, it's how did the man who make this go on to do King Kong and Lord of the Rings

Edit: This movie is called "Bad Taste" and it's in that "So Bad It's Good" category. So I do recommend taking a look.

Now you're making me want a muppets LOTR.

Of all the remakes that Hollywood could do, why not this one?!

Best part is, according to the latest Muppet Movie, the Feebles are canon.