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While Malbecco is a pretty unlikeable guy, it's hard not feel a tad sorry for him in Book 3. He loses all his money, loses his wife, and then turns into a monster. Not spectacular luck. But luck is rarely actually at work in The Faerie Queene, and it's Malbecco's problematic priorities that lead to all his trouble.
When we first meet him, he's a jealous and unfriendly miser, who refuses to let knights rest in his castle. He always suspects that his wife Hellenore is cheating on him, and based on how quickly she runs off with Paridell, he's probably right. When Hellenore sets all of Malbecco's money on fire as a decoy during her escape, he chooses his money over his wife and is never able to recover from that poor choice.
Malbecco is an important foil to Britomart since he represents the negative side of keeping things to yourself. Britomart, in her vow of chastity, keeps her virginity to herself but unlike Malbecco, this is an acceptable thing to protect unlike the frivolous things he worries about.