Here's a detailed outline of Henshaw's fall from grace.
First off, the process that turned Henshaw's team into super-freaks was slowly driving them all insane, as the Ben Grimm equivalent willingly committed suicide because he was in so much pain, the Johnny Storm equivalent merged into the sun and as Henshaw's body deteriorated into a skeleton, he started becoming delusional.
At one point, he stresses that "Only my genius can save us!" and Superman makes a mental note that Henshaw is losing his grip on reality.
As Knight mentioned, Superman and Henshaw managed to save the Wife, but unbeknownst to each of them, Henshaw survived as an electromagnetic being.
Creating a body out of technological junk and reappearing to his wife, drove her mad and into a coma, where it would later be revealed that she had died.
Henshaw, not yet able to control his form properly, was creating all sorts of electromagnetic interference... and in his grief upon learning what he'd done to his wife, broadcasted himself into the orbiting Birthing Matrix of Superman, used some of its material to create a hyperdrive unit for himself and he blasted out into space to gain knowledge.
With no one to talk to, and only having his own memories to wallow in as he travels the cosmo, Henshaw starts going insane. Despite becoming pure energy, that manifests itself through technology and thus having a near perfect memory, Henshaw starts becoming paranoid, angry and resentful at his situation. Superman had made mention way back when the crew was first exposed, that he might have accidentally caused the event that screwed up the Excalibur flight (by getting rid of the Eradicator around the time of their flight), which is a fact Henshaw latches onto and warps to fit his worldview.
Superman caused their dilemma, Superman prevented Henshaw from saving his crewmates, and Superman tricked Henshaw into leaving Earth.
Knowing this, he sets about his plan to get revenge as we see in Reign of the Supermen. As with the data he gleamed from the birthing matrix, he could fabricate Superman's skin and facial features, craft Kryptonian technology and blame any memory inconsistencies on coming back from the dead.
People cite Henshaw saying things to Lois like "I remember... snippits. Fleeting images. I see a farm... in Kansas. The name... Kent." But, he ultimately doesn't know it. Instead, it's implied he came up with those lines by using telemetric data from the Matrix ship (so he'd know it landed in Kansas, near a farm), Kent even moreso than Lois Post-Crisis was associated with Superman stories... so he'd could say just enough to even get someone like Lois to believe him.
Since Reign, he tended to go in cycles, where all he wanted was Superman dead and all he wanted was a longing to be 'normal'. At one point he even gets trapped in the Source Wall (IIRC, during The Trial of Superman).
In the "Genesis" crossover, Superman in his Blueperman phase encounters Henshaw in the wall, where Henshaw explains his true sorrow... he can't sense or feel things anymore. He can remember every aspect of his life, from his birth to getting married to Terri... but he can't remember smells. Touch. Everything is rendered in computer code. This is probably one of my favorite bits of Henshaw, as he's still an evil insane bastard, but his plight is relatable and it leads to some great back and forths between Superman/Henshaw.
Henshaw escapes the Source Wall by catching a ride in Superman's containment suit and makes it back to Earth. There he tries a bid to turn over a new leaf and start a new life, by becoming an art teacher, where one of his students is Ashbury Armstrong, friend of the alien Scourge. As Mr. Sormon, he was quite liked, if considered somewhat eccentric (he'd accidentally break drinking glasses by squeezing them too hard), of course this gets ruined because during an art class, he's forced to focus on Superman.
His mania kicks in, he starts using super-speed to create a clay figurine of Cyborg Superman punching Superman, which ruins the faux skin on his hands. Students freak out, Superman picks it up and they fight. Cyborg accuses Superman of being a harrasser and not wanting Henshaw to be happy. To which Superman replies that if Henshaw would ever actually allow himself to be held accountable for his atrocities, Superman would be be happy to let him have a normal life.
The Cyborg puts his consciousness into the clay figurine of himself, which Ashley takes home as a keepsake, as she believes Henshaw could be redeemed. The Toyman later steals the figurine and when Henshaw manifests himself, considers him as a god, since he's a 'toy come to life'.
This creates the Superman Red/Blue saga.
From this point on, Henshaw gets co-opted by the Green Lantern books, where he starts slipping into depression and madness at the thought that he is truly immortal and will never die.
So far he's had his body destroyed countless times, been shot into a black hole, put into the Source Wall... all the while remaining conscious. So when he becomes part of the Sinestro Corp, it's because #1: They'll help him get revenge at the two people who have caused him the most problems (Superman and Green Lantern) and #2: The Anti-Monitor promises that he has the power to obliterate Henshaw from existence.
As it usual with super-villains, things go awry and Henshaw is left alive once again.
So honestly, his having a death wish isn't so much of a retcon, it's the natural progression of his character... when you're immortal and you've lost everything, what's left to live for after you've gotten revenge? Or in Henshaw's case, after you've failed numerous times to kill the one you blame for your predicament?
He's always been on of Superman's better villains, IMO.