This phrase is often used metaphorically to express a loss of charm or appeal in a situation or thing. After finding out the truth about the charity's finances, it took the gilt off the gingerbread for everyone involved.
Pro Tip 2/3
Negative Changes
It's typically used to describe situations that have changed negatively, not just minor disappointments. The constant rain took the gilt off the gingerbread of our beach vacation.
Pro Tip 3/3
Subtle Disillusionment
The phrase suggests a subtle sense of disillusionment or disenchantment with something once valued. Seeing the behind-the-scenes of my favorite show really took the gilt off the gingerbread.