Covers that are arguably better than the originals:

In no particular order, here are a few of mine:

All Along the Watchtower, Jimi Hendrix

Like a Hurricane, Bryan Ferry (live 2014 version)

Money, The Beatles

Summertime Blues, the Who

Maybe I'm Amazed, The Faces

The First Time Ever I Saw Your Face, Sam Brown

Stairway to Heaven, Heart (live in front of President Obama and Zeo members version)

Whats So Funny About Peace Love and Understanding, Elvis Costello

Everybody Knows, Concrete Blonde

Crossroads, Cream

Twist and Shout, The Beatles

Shout, Lulu

Hallelujah, Renee Fleming (!)

First We Take Manhattan, Jennifer Warnes

I Shall Be Released, The Band

Fortunate Son, Pearl Jam

Talkin Loud and Sayin Nothing, Living Colour

Heroes, King Crimson

I Know I'm Losing You, The Faces

Black Magic Woman, Santana

Daydream, Chantel McGregor

Changing of the Guard, Patti Smith

And many more but I'll stop there

Geoff
 
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Hallelujah, Renee Fleming (!)
Hallelujah, k d lang...and now I have to hunt down Renee's version, I think she is super talented. She was great in The Light In The Piazza. And now in case nobody has mentioned* I'll nominate Bananarama's version of "Venus" especially the live one. Eh, I don't know if totally "better" but a bit more fun or something. And just so people can crucify me, I prefer Grand Funk Railroad's "Gimme Shelter" from Caught In The Act over The Rolling Stones (though I've come to appreciate their slower version more over time).

*isn't there a way to search this thread only?