Finally they got it right, but little bit too late.
You would think a sequel would fix all those problems, but it made it worse and brought even more flaws to the game, resulting in one horrific semi-RPG (without equipments and stores to customize, it didn't have much RPG elements except for turn based combat) The game had extremely long and frustarting combat system that required players to take cautions to simpliest enemies on the map, while the bosses are actually quite easy. Making boss fights incredibly disappointing and exploration being incredibly frustrating. Also many changes of character voice actors and character design gave inconsistancy to the setting and felt quite foreign. Also the story swayed away from main characters of first game and ended up feeling more like side story than actual story sequel I had to talk about previous two games as they have direct connection of this one. The third one actually fixes most of the problems that lied within first and second game and comes close to the quality of the game we expected in the first place, Xenogears. Still, it fails to reach the level Xenogears reached as RPG thanks to subpar storyline and exploration. First, very importantly they fixed the battle. Thank goodness. Now regular attacks actually means something as it does reasonable damages against the enemy. Also now difficulty is more reasonable and battles are quite fast. No longer you need to drag every fight. The boost system is back, but clunky and frustrating combo system is gone. Also the unique tech attacks of first game is gone as well, and did take more traditional turn based combat system, and it works very well. The break system does make battles frustarting time to time, but compared to previous two, I really shouldn't complain too much. Another immediately noticeable improvement is character movement. Now characters move more fluidly and much faster. no longer your characters looks like it's moving in water (first Xenosaga) or in slow motion (second Xenosaga) This makes exploration much easier and not frustrating. Now you don't have to fear walking about to look for treasure chest. Also the equipments and shops are back. This is also an improvement including the first game as the amount of money you can gather during your exploration matches quite well with the prices of items. That includes E.S (the robots you ride) so finally developers learned to eliminate many frustrating features of previous two installments. The dungeons are fairly good size. Unlike first game it does't seem too bland nor big, and unlike second game the enemies aren't clustered to have more joy while exploring. So in terms of gameplay, they finally got it right, but that's just merely fixing the problems. Compared to unique battle system currently released RPGs (FFXII and Valkyrie Profile 2) the battle system does feel quite bland. Still it functions quite well and RPG fans surely would appreciate the simplified battle system. Now let's talk about graphics. Here comes the problem. Graphically, the characters and background is more detailed than second game, but also many character models has been changed quite a bit compared to first and second. Many did maintain their design to keep some consistancy, but most noticeably MOMO has changed way too much from first game to second game to third game. She seem quite foriegn in all three series and it breaks the consistancy of the story and personality of the character. In second game, MOMO looked identical to Sakura, who had quite a bit of Asian features on her face. Now MOMO looks like European doll. Also her voice acting seems to be changed back to the first game, so there is lack of consistancy to keep the personalities matched from second game to the third. Other than that, graphically the game looks quite good and many character designs are well done (especially Chaos, thankfully he isn't wearing tights anymore)
What hurts Xenosaga III the most is the voice acting. Not the quality of voice acting but the personalities inconsistance. Cannon is one of the victims. He was introduced in second game and he had that voice and tone of 'I don't care' type. Very cool and calm and emotionless. The new voice actor makes him seem like he is man of attitude. He sounds agitated and slightly angry. Considering he is realian (artifically made human) and his conversation, he should be emotionless like in the second game, but thanks to the inconsistant voice acting, the players get thrown off especially if they did play second game. MOMO returned to the first game voice, but thanks to great job the second game voice actress did, she doesn't sound out of place. In second game, her voice sounded bratty, but thanks to good acting she maintainced that innocent girl image. Still sudden change of voice does throw her personality off little bit. Shion also returned to first game voice as far as I can tell. Thank goodness. Her personality seems more natural this time around. Although she still shows that spunk from second game (which was missing in first game) it has been a year since second game so her slight over the edge personality does make sense and could be digested. Also her attitude sounds slightly calmer than second game. Well, according to dialogue, she snaps more compared to second game, but she loses her temper more believable way unlike second game. Most importantly, KOS-MOS voice returned. This is quite important as the first game voice actress did wonderful job as KOS-MOS. Although KOS-MOS lost the cold exterior and facial expression you saw in first game, at least her voice acting makes it feel like she is still a robot, although she talks in softer tone compared to first game. In other words, the voice acting is mostly satisfying. Cannon isn't a character with many lines so that can be over looked. If they managed to maintain the voice acting consistant in the first place, there wouldn't be this problem but in the third game they did great job to fix that problem. Still the flaws of second game is passed to third. The most important part of this game is obviously the story. Since the story is contiuation of the first and second, you can expect to uncover the similar surrealistic story. However, on the third game, there is more story to be uncovered and does better job showing different parts of the story more often to keep the players interested better. There isn't much void of storyline to make players lose interest in the story or stray away too far from the main character storyline like second one. There is a void of a year between second and third game that you need to just fill it in with narration, but that won't trouble the players as much.
Also interesting thing about Xenosaga III is many of the Xenogear duplicates are introduced. Such as Elly, Fei, Citan, Maria, etc etc etc returns to Xenosaga III under different name and personalities, but they are all recongizable. With better method of telling the story, improved graphic, voice acting, and non-frustrating gameplay, finally Xenosaga managed to come up with an RPG that is enjoyable and appreciated. However, the damage of previous games has already left bitter taste in many fans tongue. This last episode does make it easier for the fans to swollow it, but it is too late to save this franchise from being anything more than medicore.