Like everyone else who has answered your question 'am I a terrible teacher?' with this response let me echo, too, if you were a terrible teacher, you would be blaming the kids totally and not evaluating your own practice. And we have ALL been there, in one way or another!
I would only add to the sage advice of grading along the way, having mini due dates, adjusting seating or final due date, the one which jumped out at me totally....one assignment for an entire quarter is not the way to go. I worked with someone who did something very similar, and I think what happens often in the classroom, is that we have an idea which seems so wonderful in theory, but in practice plays out entirely differently. I had the 'luxury' of watching it, rather than being 'in' it. As a student, I'm not sure I would want my quarter grade to rest on one piece of my work.
I would suggest, you change the pace with some short term assignments, and perhaps think about what can be done to salvage the large works which were not up to par. After a break from them, could the students come back and perhaps work with them, by say, slicing them and trading pieces to create a large scale weaving, collage or some other assmeblage which also could be worked on during 'down' times-or taken home-in between other assignments?
Folks have talked about reputation, and expectations and the fact that you care is an important underpinning. There's also the element of creativity that we can carry into a situation which has not turned out as we projected. The kids will respect your fairness and flexiblity as you decide how to deal with this. At the same time, you can establish a refined culture in your class towards a more serious and managable working atmosphere, with you setting the tone.
Just my 2 cents & good luck!
to anyone who has experienced this,