I'm not sure why "favorites" has no (explicit) separation between fics you want to follow and fics you think are fabulous. I'm going to try to list the great stuff here, in descending order from absolute bestest to pretty darn good. Also I figure that if it's good enough to list, it should be good enough to wax rhapsodic for a few sentences.
Under construction. I tried to grab everything I had given a thumbs up, but that turned out to be huge. The top of the list is accurate. I lost focus by the bottom.
Xenophilia -- An incredibly sweet romance wrapped around a hefty filling of great clop, with interesting AU world building and a just hint of action thrown in for flavor. I'm aware everyone has their own idea of what makes good clop and that my taste is "drier" than what I usually see, so I'm almost weirded out by how well this clop matches my taste in most things (in word choice, activity choice, attitudes, etc.). Still, I love it all the more for it. Even though I'm embarrased as heck about recommending a clop story (and I know the sad fact is that YMMV), I can't recommend this one enough. There's also Xenophilia: Side Stories, where the chapters written by the original author are very good. There's The Xenophile's Guide to Equestria which is an experiment on how to do dry info dumps, with a poignant relationship storylet hidden in the middle (starting with Rainbow Dash's journal entry). Then there's a whole Xenophilia HQ Group but I haven't read much else yet.
Spellbound Fireflies -- From the description, "A story about love, family, and growing up." It's Scootadopt TwiDash and a whole lot more. It's heartwrenching awesome. It's expert story craftsmanship. It's bats. One of the things I love about this story is that it's unusual for a shipping story in that it skips right over the tender, tentative first steps of the relationship and jumps right in to the boisterous, lusty, vivacious middle. And don't get me started on the title. You NEED to read this story.
Quantum Castaways -- Some mysterious entity is capturing beings and leaving them to survive in a pocket universe desert island. Twilight and a human are the only sentients here. They quickly team up to survive. I am in awe that a story this unabashedly profane can still have such tender and emotional moments. Also, this.
Coming Back -- A Rainbow Dash epic adventure with strong TwiDash, by bats.
Nyx: There's lots to love here. All are above the high bar unless mentioned otherwise.
* Past Sins -- First, the original. An attempt to bring back Nightmare Moon creates a filly instead, and Twilight becomes her mom. But who is Nyx, really?
* Winter Bells -- Pen Stroke's take on Nyx meeting Twilight's family.
* Nightmare Night and Nyx -- Luna throws a Nightmare Night party, Nyx attends, awesomeness ensues.
* Nyx's Family -- RealityCheck's take on Nyx meeting Twilight's family and the history of the Crystal Empire and Equestia. Best line: "Nyx, why the heck did you yell 'FIRE?'" "Well," Nyx said with a mournful little sniff, "Nopony would've come if I'd yelled 'LAUNDRY.'"
The Last Equestrian Princess -- What happens, post ascension. Well written, with tear jerking and awesomeness.
Old Friends -- This is a short. Very emotional, but I'm not even sure what name to give those emotions. I don't want to give anything else away. Go read it.
Arrow 18 Mission Logs: Lone Ranger -- HiE done in first contact style. Lots of fun meeting the ponies in a semi-realistic situation. One of the best HiE out there.Arrow 18 Mission Logs: Sparkle's Notes is a side story from a different point of view.
The Games We Play by AbsoluteAnonymous
-- the high bar --
A Stitch in Time -- Great shipping between Twilight and an OC, lots of action, a great Star Swirl (best line: “Would you shut the buck up for one second so I can start treating you in a more respectful fashion?”), and the Mane 6 get to start out by carrying my beloved Competence Ball for a change. Lots of time travel, so watch your head. Sequel to Hard Reset which is pretty much all dark action (but probably a necessary read), and followed by You Can Fight Fate (still early days, but seems to be more like Hard Reset than A Stitch in Time).
Yours Truly -- A sequence of letters, lots of shipping but predominantly Twilight and Applejack. Tearjerker. Great ending.
A Voice Among the Strangers -- HiE. 170K words and 90% of the time the main character had no idea what's going on, yet the story is awesome. I don't understand how it's possible, but nevertheless it's true.
The Audience -- HiE done humorously and awesomely. Also by RealityCheck, Cheerilee's Class.
Parting Words -- Twilight loses faith in Celestia. RealityCheck loves to drop anvils, but the thing I find amazing is that he goes back and fixes it all. That segues directly in the continuation, The Great Alicorn Hunt which is still pretty new but clearly desinted for greatness. In a nearby universe that has Nyx in it is Alicornundrum. It's a little hard to keep them all straight, but they're all good.
A Spell for Lyra -- Short sucker punch to the feels. Then there's My Little Twilight which is slightly more upbeat and and a mix between A Spell for Lyra and My Little Dashie. My Little Dashie is an early and infamous story, with writing which is too gray to be a favorite of mine, but still definitely worth a read.
Memories We Never Had -- An awesome short, an introspective look at the aftermath of Magical Mystery Cure on the switched ponies. Really interesting idea.
MLP Time Loops -- This one is a large collection of shorts. It's a mixed bag. Most are funny, some I don't get the references for, and some are jaw dropping awesome. Rarity ascends by making dresses. Nightmare Moon is restored through song. The loop after Past Sins, when Twilight realizes Nyx is gone.
Friendship is Optimal -- An AI based on MLP:FIM takes over the world. A great singularity story, with lots of things to make you think. The side door by which I entered MLP:FIM fandom.
Friendship is Optimal: Twilight of the World -- Set in the FiO AU, a realistic and balanced view of why an intelligent and religious person might not upload. An interesting exploration of ideas, awesome because it admits there are no easy answers, and the ending is made of (thought provoking) win.
True True Friends Until the Very End -- a great little one shot about alicorn Twilight far in the future.
Wild, Sweet & Cool -- Fun TwiDash friendshipping. Builds kinda slowly, but has an awesome finale. Best line: “What is this ‘not wanting to learn’ concept you speak of? I’m not familiar with it.”
Inscape -- This story is about Pinkie Pie being awesome. It's is a fun AU explanation of Pinkie Pie, and as the Cakes say in the story, "That . . . explains a lot, actually." This story is part 2 of The Petriculture Cycle. This is where the story really gets swinging, but you should read part 1 - Petriculture first (consider Petriculture to be Chapter 1, and then immediately dive into the subsequent chapters of Inscape).
Three Hundred and Fifty -- Good adventure story with Twilight and Sweetie Belle becoming close, interesting ideas, and good ending.
Unrequited -- great twidash, in a head to head face off against Little Wonders, also great twidash. (more thoughts needed)
What is a Name? -- Pinkie Pie is reverted to a child and has to learn who she is all over. But what happened to the old Pinkie Pie? A good take on the two personalities, one body trope.
Twilight's List -- Good TwiDash. Fun, and Dash gets to be surprisingly mature at the end.
Show me, Don't Tell me -- Fun bit of TwiDash. Rainbow gets to have some depth.
The Assumption of Applejack -or- Appletheosis -- a fun romp with Applejack, but I can't remember enough to give a good comment. Continued in In the Service of the Goddess and (honorable mention)The Final Accusation: A Legal Comedy
Rites of Ascension -- A pre-MMC take on Twilight ascension. Fun. Designing Intrigue is an honorable mention side story in the same universe where Rarity is a spy.
Playing With My Heart -- Vinyl and Octavia story, framed as flashbacks while waiting beside a hospital bed. Grew the beard in chapter 5. Not sure where this is going to end up, but it has potential.
On a Cross and Arrow -- Main 6 get stranded in a Rule 63 universe, and keep running into themselves as they try to get back. One of the classic fimfics. Continued in On a Whisper of Wind which unfortunately is incomplete.
Higher Flier -- Rainbod dash faces a challenge to her pride in this aeronautical mystery. Can the SR-71 Blackbird be turned into a great OC? Yes, yes it can! The sequel, Higher Flier: Mach Two, is fun but incomplete.
-- the low bar --
Starlight -- Post-apocalyptic story. All unicorns have been killed by a new ruling cabal and the rest of the mane 6 are rebels. Rainbow Dash finds a unicorn filly. Action-adventure.
Friendship is Empathy -- Author tract, Rainbow hurt by Mare-Do-Well vs. Twilight hurt by Canterlot Wedding. Well done though.
We'll Keep In Touch -- Good TwiDash. I liked Rainbow's effort in the middle but thought the ending was weak.
Minuette's Lesson -- A fun AU meditiation on what makes a real person.
One More Shot -- Rainbow Dash gets to be awesome.
PonyFall -- An interesting idea. A bunch of ponies get dumped on earth. They meet a bunch of shocked bronies who try to help them and figure out what to do next. There are a bunch of different writers and the quality is variable, but over all it's pretty good.
* PonyFall: Australia -- this is the root story, and it's pretty well written.
* Ponyfall: Onward Valiant Crusaders -- this is one of the best contributions, with realistic handling. Also, while it's standard trope to think something bad will happen if the ponies find out they're fiction in our world (balderdash!), this has the only (IMO) legitimate freak out I've ever seen, and the resolution is well handled.
* PonyFall: Leather and Lace -- another great contribution, very realistic handling. I find the title off-putting but it seems to have nothing to do with the content or quality of the story, so . . . I just ignore it.
* PonyFall: The Dawning of Twilight -- also pretty good.
* (See the Group for the rest.)
PONY Legacy -- A nice ponification of TRON Legacy, in progress.
An Affliction of the Heart, An Affliction of the Heart: Volume Two,
An Affliction of the Heart Volume Three: Hybrid -- A changling and a pony fall in love, probably. Pretty good.
Sugarfree -- Well written and it's fun to see Celestia slumming it, but insanity is a hard genre for me.
Unfinished -- Another crossover with a rule 63 universe, but things are not what they seem. Interesting but getting very dark and meta.
Tangled Roots -- (borderline) Lots of back story exploration but dark and the characterization was not advanced enough in age to avoid squickiness in the foalshipping.
-- need to reread --
Learn to Fly (Derpy's Tale) -- can't remember. Side story: Take These Broken Wings
Nopony Needs to Know -- can't remember.
Shine -- This is an ascendant side story. A short sucker punch, but mostly happy. Expands on Tiny Wings, which I can't remember.
Cinnamon and Sugar -- can't remember / not sure.
The Twidash Project -- can't remember / not sure.
Flitter -- can't remember
Shut Up -- can't remember
Never judge a book by its cover, continued in Purity -- Can an earth pony have magic as a special talent? - need to reread for a good comment.
My Sister, Loyalty -- can't remember
Derp Day Afternoon -- can't remember
Twilight learns a secret -- classic. can't remember
Sparkle Dash Family: TMP Stories -- TwiDash Scootadopt. Written out of order and at the same time as Spellbound Fireflies, so it's all muddled in my head.
Letters From a Secret Admirer -- TwiDash, can't remember
Melt
The Life You're Given
Not By Its Cover
Reading Rainbow
Night Light
Anthropology
The Numbers Don't Lie
Family Matters -- lunaverse
The Hero of Oaton
Right then Faith
Study Buddies
A Twilight Landing
Authored for Adoration
Changing Strings and Other Things
Colors of the Heart
The Piano Man: Act II
The Piano Man
Princess Celestia: The Changeling Queen
Five Score, Divided by Four
Hands
Crisis on Two Equestrias
Awakening Pink
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