Budokai 3 had a great amount of improvement and is the best in the Budokai series ever.
DBZ : Budokai 3 made huge improvements from its predecessors. The sound was greatly improved, additional voice acting, a whole rack of new characters from DBGT and the movies, new ultimate moves, more cinematics, a new single player Dragon Universe mode, a new Dragon Arena mode, greatly improved graphics, a DU story for many characters, flying whenever you want, teleporting just like in the shows, and an awesome cinematic DragonRush move.
Now when players strike their opponent, they can actually feel the power of the punches and kicks that the characters throw at eachother. The screen shakes slightly and the controller vibrates with each strike. When a character gathers up Ki, the ground starts to shake and sends little shockwaves. Gathering up Ki also makes a character much more stronger, and gives the character an obvious Ki aura like the shows.
New moves and transformations were also given to selected characters. Goku can go up to his awesome Super Saiyan 4, Vegeta can go to Super Saiyan 4, Cell has access to all of his forms, Frieza also has access to all of his forms, and Broly is introduced along with his signature Legendary Super Saiyan form. New moves include a normal Dragonfist for Goku, unique death moves such as Goku's 10x Kamehameha and Vegeta's Final Shine when they go to Super Saiyan 4, and an additional moves for other characters. All characters can go to a new Hyper Mode, where the character is glowing red and has access to their ultimate moves.
New ultimate moves and improvements on past ones are also appreciated. Bardock's ultimate move The Spirit of Saiyans is my favorite. Goku has a new Super Dragonfist when he's in SSJ3 or higher, Broly has an awesome Gigantic Meteor, Cooler with his Supernova, Goku with his improved Spirit Bomb and Super Spirit Bomb, and many others.
New fusions were also introduced. Gogeta and SSJ4 Gogeta are two of them. Gogeta has an ultimate move called Soul Punisher while SSJ4 Gogeta has a unique and powerful 100x Big Bang Kamehameha.
The sound improved and more voice acting was added. When a Saiyan transforms, they say different things. For example, when Goku goes SSJ4, he says "I'm stronger this time" and when Vegeta goes SSJ1 he says "Prepare yourself!" Certain characters also say something different when they begin to fight eachother. When Vegeta and Goku fight, they say something that is directed towards eachother.
This game is just excellent. The game even appeals to people who are not even interested in DBZ. The game is very addicting due to its intense action and awesome cinematics. SImply said, Budokai 3 had a great amount of improvement and is the best in the Budokai series ever.