Whenever I've heard or used the phrase "worm theology," it's always been in reference to an attitude that says we human beings are just wretched worms in the dirt, deserving nothing more than to be ground underfoot. I have always rejected this attitude. We are indeed desperately fallen, but we were created by God Himself (whose creation was, by His own affirmation, "very good") and are redeemed by the sacrifice of His Son, and that means we were and are not wretched worms (even if we choose to live in the dirt sometimes). We were originally destined for glory and eternal life with God, and we may still receive that destiny in Christ, who loved us even in our fallenness and delights in us now as His children. (See Ephesians 2 and John 17, e.g.) As C. S. Lewis says, we would tremble before the least and worst human being if we truly understood that each of us is an immortal soul.
However, I've decided that worm theology is not just unfair to man, it's unfair to worms. Of course, there are those creatures we call "worms" that destroy plants, and great and greedy "worms" like Smaug that create even greater destruction, and I can't find a great deal of sympathy for these. But most of us, I'd guess, think first of earthworms when we hear the word: and earthworms are greatly slandered if we think of them as wretched, useless creatures deserving of no regard. In fact, they are a lovely example of true servanthood.
The earthworm, a simple, blind, not especially appealing creature, lives underground and is seldom seen (and greatly abused by bird and man when he is). He goes quietly, and mostly unremarked, about his job of improving our lives by aerating our soil so it will allow the roots of plants to grow deep and strong and more readily receive the nourishing rain, and then enriching that soil not only with his waste but ultimately with his very body.
This is a picture of serving at its best: fulfilling one's purpose without complaint, without show, without striving after prestige or reward; giving one's life solely for the benefit of others. Of course, the worm does this without thinking about it, without agonizing over the temptation of sin and trying to rationalize his duty away. He simply does what he was created to do.
And so were we created to serve God and our neighbor, with the difference being the possibility and reality of refusal to accept and live out our purpose. So the next time I'm confronted with "worm theology," I think my reaction will be a little different: I'll wish I were more like a worm than I am.