Seems that the term Fred is different everywhere.
I'd use it in two ways:
1) To describe the guy riding £8000 worth of bike at 14mph around flat cycle lanes on only sunny Sunday mornings (the cycling golfer as I like to call them). I have no problem at all with these guys, if they want to spend their money that way more power to them.
2) The guys on club rides who have no idea what they should be doing in a bunch and seem completely unwilling to learn. I ride with two clubs, one is pretty much populated with racers, time trialists and guys who have ridden bikes for multiple decades and can comfortably do any ride they fancy. This club is fantastic, it's a lot more like riding with a group of mates as the core 10-20 riders turn up most weeks. We do varied runs, flat and fast or long with climbs and everything in between. Everyone talks to everyone, cafe stops are always a good laugh and everyone has been extremely friendly and welcoming, even when I've fallen off the back and they've had to wait for me! They have been extremely helpful giving me advice on technique, road craft and riding in general (and I take it all on board. I don't mind an irritated voice telling me to get left when we're flying along at 30mph, it's hard to sound pleasant at that speed and I'd much prefer they said something.).
The other club I ride with is much bigger. They have much more well defined pace groups (about 4 of them but sometimes 6-8) and I usually ride with the racers or the one below. These groups are fine but I have ridden with the slowest group in the past for recovery and this is populated with "Freds". Guys who can't hold a line, jump on the pedals as soon as they move across in the pace line, freewheel going downhill so everyone behind them has to brake constantly, randomly brake for things they could just roll through (several crashes have been caused by this) and who will not listen to anyone telling them not to do it. The worst thing is the guys who generally lead the group are some of the worst offenders. I'm not a member of the club so I don't say anything, but I know a couple of guys who ride in that group who have started to complain. To me, that's the cycling club Freds.
The guys who look down on other peoples' equipment, bully them into spending money on unnecessarily expensive upgrades (I ride steel because carbon will not make me faster thank you very much and 105 works perfectly), constantly go on and on about their victories in tiny local racers where they are beating guys who've only just started riding and who have to have the latest and greatest kit are just wankers.
The arseholes in cycling clubs are easily spotted and avoided, it's unfortunate but cycling does seem to attract larger than its fair share of them. I'm very lucky that there aren't any in the clubs I ride with, at least none that I've met.