The Dutchman oversaw the worst start to any top-flight club's campaign in 93 years while at Selhurst Park and managed just four Premier League games in South London.
Palace have endured four defeats without scoring a goal this season as the club prop up the Premier League.
"De Boer inherited a mess, that's why Sam [Allardyce] wanted out, and they've made him a scapegoat," Nicholas told Sky Sports News.
"You look at [chairman] Steve Parish and wonder what is he contributing? Why did Big Sam leave them?
"I put no blame on De Boer. Of course he wants to play a different style but so does every manager. It's an absolute joke that this happens and Palace are a joke to treat somebody with a good reputation like this.
"Parish should hang his head in shame. I just find it absolutely deplorable."
Former England boss Roy Hodgson is the favourite to take over at the club, who host Southampton on Saturday.