KotOR is a great game for Star Wars fans and anyone looking to get into RPGs. But really, everyone should give it a try.
First off, lets get the smaller stuff out of the way: the engine that powers KotOR is dated by today's standards so the game's environments will not impress, although some of the exterior levels look pretty good. Also, the engine could have used some tweaking and polishing because it often has frame-rate drops and a few minor bugs.
Now lets get down to the really important stuff. I'll start with the most important aspect of a story-driven role-playing game like this one: the writing quality. KotOR isn't all that great in this department (still better than the new Star Wars trilogy though); the quality of the dialogs is a bit inconsistent, although the voice acting is generally good. The implementation of fully voice-acted dialogs works to the game's advantage. Furthermore, it's worth mentioning that the story is decent; there are enough plot twists to keep the player interested, and enough good quests to keep the mind alert. The best thing about it is that it imparts a lot of Star Wars lore, some of which is very interesting. It's a definite plus if you're a fan of the franchise... and even if you aren't, lore is an important element of any fleshed out game world.
Another important thing for a role-playing game to have is choices, and KotOR is a mixed bag in this regard. The thing is, most of your choices don't matter because towards the end there's a moment that can basically erase every choice you made prior to that point. Truth be told, there are only a handful of choices with true impact on the game. Also, the game treats morality in very 'black and white' fashion. The dark side feels forced most of the time since you have to act like a high-school bully to walk this path. I know Sith are supposed to be evil, but helping some kids mug an Ithorian is just silly.
Of course, stats are an ever-present element in RPGs and KotOR is no different. What we have here is the Star Wars D20 ruleset, which is somewhat similar to 3rd Edition D&D: you have 6 basic attributes, skills, feats and a magic system, which translates into Force powers in this setting. As you can see, it is similar to D&D, and it plays very much like a D&D game, that's why I said in the intro that KotOR is not that different from Bioware's previous efforts. One of the best aspects of KotOR is that it puts to good use most of your skills, making the experience more varied, since there's always something to hack, repair or bypass. Plus, this means that some levels have multiple ways to get by, which is always a great thing to experience in a game. On the other hand, the combat system is limited on the tactical side, plus you need to rely on companion AI way too often, an AI that might or might not come through for you.
Another positive thing about KotOR is the sound. The game has atmosphere, no doubt about that; levels like Upper City Taris or Manaan have a great background buzz which makes the game feel alive. The music is also very good, although it leans towards high fantasy a bit.
Overall, KotOR is not a heavy, hardcore role-playing game, it strikes a balance between accessibility and depth. It definitely isn't up there with the likes of Planescape:Torment, Fallout or the surprising NWN2: Mask of the Betrayer, but it's definitely a great game. So if you are having doubts about buying this game you should definitely forget them... the Force is strong in this one!