The high reference isn't only used to express phisycal high of an object or the size of something but also a level of something (ideologicaly, mentaly etc ...) as instance : High grades, I'm high etc ...
So here, to talk about something of poor quality (either a film, story, joke, humor, exam, etc ...) we used this expression to say that it (the thing you're talking about) is just above the high (level) of the daisies -> not very high and so, not very good (of poor, low quality)