I've heard this before and I think yours is a rather misguided interpretation of this theory. This doesn't support that that "evil has nothing to do with malice" nor that "the epitome of evil is banal".

I could agree that traditional malice, as in an active desire to do harm, isn't the real requirement for all evil, so much as it is awareness of and willingness to do harm. In that way, both malicious and banal acts could be evil. Eichmann wasn't evil because he was banal. He knowingly and willfully committed acts of harm, and was banal while he did it. It's the knowing and willful parts that make his acts evil, not the banality. Its nothing more than a certain dispassionate flavor of malice or calculated, utilitarian amorality. Banality itself has no bearing on it.