While success at the ballot box is definitely a factor, my personal experience from speaking to Conservative party members, as well as a couple of MPs, is that Thatcher's legacy is remembered with such fondness by a large proportion of the party because of her transformation of the country's fortunes after the 'dark days' of the 70s. I think it's necessary to go into a bit more detail with regards the state of the country before Thatcher's tenure as Prime Minister to fully explain the feeling of nostalgia felt, especially by older members who personally remember her premiership.
James K mentions her breaking of the post-war consensus - in brief, the idea that everyone in the labour force should have full employment, unions should be empowered, the state should own and run the utilities & other national organisations such as the railways and British Airways, an expanded welfare state, and so on. This had been in place since 1945, and had had a lot of success - the establishment of the National Health Service, low unemployment, wage rises. It lead to massive increases in quality of life, but these came at a cost.
The consensus had its downsides. The powerful unions were able to prevent modernisation and mechanisation, and industry profits were not balanced between wage rises and investment, which led to ever-increasing inefficiency. Industries, particularly the coal industry, were only kept afloat by massive state subsidies. As the 1970s rolled around, things began to come to a head. Money started getting low. The inflation rate, already high in 1970 at around 6%, peaked in 1975 at over 24%. The top rate of tax was at 90%, investment was not rewarded and there was a brain drain to America and elsewhere. The UK was known as the 'sick man of Europe' for much of the 60s and 70s. Unions began to strike, particularly the mining and railway unions, leading to the introduction of the three-day week by Conservative PM Edward Heath.
Heath called an election in 1974 to try and consolidate power and receive a mandate to deal with the unions, but was unsuccessful and Labour's Callaghan took over as Prime Minister. Callaghan tried to keep pay increases for affected sectors at 5%, but swiftly had to abandon this in the face of pressure from the unions. When the government could no longer afford to pay, it had to go cap in hand to the IMF for a bailout like some tinpot dictatorship. The winter of 1978-79 was known as the Winter of Discontent. Strikes took place across practically all public industries, refuse collectors left rubbish strewn in the streets, corpses remained unburied due to gravedigger strikes, power-cuts were common.
When Thatcher came to power in May 1979, she began to raise interest rates and focused on indirect taxation such as VAT, rather than direct taxation through income tax to encourage investment and tackle inflation. In the short-term, inflation increased, but within a few years this fiscal policy resulted in inflation receeding to manageable levels. She tackled the unions which had held the country to ransom in the 70s by refusing to increase subsidies, leading famously to the miner's strike in 1984-85. The dominance of the unions was eroded through the privatisation of vast amounts of nationalised industry, which decimated certain areas of the country, particularly coal mining areas in the North.
Many Conservative party members argue that the ends justified the means - Britain was transformed from a nation which could barely make ends meet, plagued by power cuts, low productivity, and skyrocketing inflation. The Conservative party membership tends to be older, around the mid 50s, and predominantly lives in the south of the country, which explains the lack of generational mistrust experienced by those in the north.
Other factors affecting the rose-tinted spectacles include a certain amount of jingoism relating to her response to the Falklands War, as well as the Housing Act 1980 which gave council house tenants the right to buy their social housing. This had the effect of allowing an entire generation of those less-well-off to get onto the housing ladder, while reducing the stock of council houses for future generations. Many Conservative party members are of the age that they or their parents benefitted personally from this policy.