This was a clever nod to the infamous B-movie director Ed Wood, known for his low-budget, often campy films. Hughes used this pseudonym for scripts that he didn't want to be directly associated with, or perhaps for those that he considered to be less serious than his other work.
For example, he used "Ed Wood Jr." for the screenplay of "National Lampoon's Vacation" (1983). It's interesting to note that this pseudonym was also used for the film's sequel "National Lampoon's European Vacation" (1985).
While he was known for his iconic teen comedies, he also wrote other genres, and sometimes used a pseudonym to separate himself from the "John Hughes" brand.