Long time mentor here (1.0 and alpha tester... I hit mentor status within a day or so of it being introduced.)

A good mentor pays attention to the party, watches and observes, and tries to help people figure stuff out on their own before intervening. Good mentors also immediately own up to their own mistakes, and laugh off mistakes in lower level content if someone oopsied and failed a mechanic (thinking of stuff like the Doom squares in baby Temple of Qarn.)

A bad mentor will not really make any attempt to teach or coach, but will yell at people for mistakes that seem obvious to a veteran but are still new to a sprout.

A good mentor seriously acts like they are an ambassador for the game, doing their best to present the helpful and friendly part of the community. Bad mentors almost seem to be willing to deliberately chase new players off.

I seriously love coaching a willing, brand new player through a dungeon or a fight. If I can show how much fun I'm having, I hope that it encourages the new people to stick around for a long time.