It is not bad neither great.
Now I'm not really looking forward to the next one because of Fable III:
+ it's short
+ the fighting mechanics have devolved because they force to switch between weapon and magic mode [with mouse and keyboard], which is terrible as it wastes reaction-time, it's cumbersome and magic should be equally important as melee as well as complementary
+ the spells are neither as visually interesting as the ones in the previous game nor powerful and they take too long to be cast.
+ sidequests are repetitive and boring.
+ doing sidequest or fulfilling requirements as means to upgrade the weapons is a really neat idea but sometimes those quests or requirements do not get thrown at you by the game making them impossible to do [I'm still waiting for the "drag people to work" quest to improve my mace]
+ the gnomes are funny but their dialogue is repetitive and finding them is a royal pain
+ Theresa, the gipsy seer that sets the plot of each game into motion, plays a thirtiary role in the adventure
+ some of the quests require an online connection to Microsoft Live in order to be completed
+ the demon doors are too complicated
+ there's no point in getting married nor having children
+ there are some interface bugs while switching from the world to the Sanctuary and when selecting area locations for fast travelling that will take you to the beginning of the level instead of the designated location.
However there are some positive things about it:
+ the main characters are interesting to look at
+ the industrial revolution era Albion is nice
+ Sir Walter and Jasper, the butler, are terrifically voiced as well as wonderful characters
+The Aurora level of the game, specially the desert traverse, is the best designed and executed part of the game, where it ironically shines
+ it supports forced widescreen ratios for non-widescreen resolutions
+ it runs rather well on low-level hardware such as mine [AMD Phenom X4 920, 4 GB of RAM with a Nvidia Geforce g210 1GB (1024x768p 16:9) on Windows 7 x86 32 bits].
The game could have been wonderful but it falls flat and short instead yet it can be played without remorse. Getting it will not be a waste of money
What happened to Fable III's development is a true shame for a lovely saga that I certainly wish for its recovery in the forthcoming instalment.