Here we come up against my initial point. The literal meaning of in medio is 'in the middle'. At first sight, 'Virtue stands in the middle' does not tell us very much.
However, the saying in medio stat virtus is a well-known phrase that sums up a philosophical view which analyses forms of conduct into extremes either side of a mean, or middle, and which analyses human excellence or virtue in terms of realisation of potential. That is where the idea of moderation comes from. It is not immediately expressed by in medio, 'in the middle'.
Once we put the saying into the negative, it no longer expresses that philosophy: hence there is now no reason to attach that special significance to the phrase in medio and we are left with a relatively empty statement.
If you wish to make a statement which purposely denies the philosophical view expressed by in medio stat virtus, then a stronger form of declaration is needed, which denies the proposition as a whole, for example:
illud nego, virtutem in medio stare 'I deny the idea that virtue resides in the mean'.