The controversy over the usage of nice is as long-standing as its range of meanings. Although Jane Austen used it in its modern sense (see Gritchka's write-up), she also recorded the common attitude toward that usage.
"...But now really, do you not think Udolpho the nicest book in the world?"
"The nicest; by which I suppose you mean the neatest. That must depend upon the binding."
"Henry," said Miss Tilney, "you are very impertinent. Miss Morland, he is treating you exactly as does his sister. He is for ever finding fault with me for some incorrectness of language, and now he is taking the same liberty with you. The word 'nicest', as you used it, did not suit him; and you had better change it as soon as you can, or we shall be overpowered with Johnson and Blair all the rest of the way."
"I am sure," cried Catherine, "I did not mean to say anything wrong; but it is a nice book, and why should I not call it so?"
"Very true," said Henry, "and this is a very nice day; and we are taking a very nice walk; and you are two very nice young ladies. Oh! it is a very nice word, indeed! it does for everything. Originally, perhaps, it was applied only to express neatness, propriety, delicacy or refinement; people were nice in their dress, in their sentiments, or their choice. But now every commendation on every subject is comprised in that one word."
Chapter XIV, Northanger Abbey (1798)