This problem of storytelling in games is, I feel, shown very well in Resistance.
Fall of Man drops you right into the action with very little explanation. You know enough to say that this is an alternate universe, some kind of baddies called "Chimera" are around, and it's up to Team America to save the universe again. This would be a terrible plot where it not for the fact that the whole game is built around you having little to no understanding of what is truly going on. Every new revelation - be it about Chimeran technology, their reproductive cycle or just how screwed Britain is - draws you deeper into the mythos. Hale plays the silent protagonist role for the most party (the other characters even joke about how little he speaks) to help the player feel like it's them fighting for survival.
Finally, the 'threat' builds quite slowly. Fall of Man plays its cards close to the chest, with Titans being thrown out rarely, the Stalkers being mostly relegated to vehicle sections after you first kill them on foot, and the really big things being a once or twice sighting right at the end. The game tells you a lot about Goliaths and Widowmakers and so on, yet keeps them out of sight so you never know what to expect until they're right on top of you. It's horror 101: the monster imagined is more terrible than the monster witnessed.
Then comes Resistance 2... and it gets everything wrong. Remember that Goliath you fought toward the end of Fall of Man? The thing so tough you had to steal a Chimeran battlemech to engage it? That's the first boss, and you'll spend the entire level killing it with nothing but a rocket launcher.
Well done, Insomniac. You've gone and blown your load within the first two minutes, and there's eight hours to go.
The game then proceeds to hammer home its idea of what modern gamers want; to be led around by the nose and have their ears raped by an unending string of "do this, do that, walk forward, turn left here, exposition! Exposition! Give me the controller and let me take over so you don't miss this really dramatic bit!"
Despite having more lines, Hale arguably has less character now. I honestly can't tell you a damn thing about him other than *spoiler alert* he goes all Chimeran and dies at the end. There's some piss-poor attempts to make us care about the characters halfway through by learning they had a family in a town that got wiped out, but that means nothing. We never met them, we'll never see them, and they are not mentioned again. This is not character development!
In conclusion, Resistance 2 seemed to believe that "plot" means lots of angry army men growling at one another as they march through a string of ever more stupid setpiece boss fights (the Leviathan seemed, in my recent replaying, a painfully dumb idea). Even as a fan of the series, I find it hard to care about this game's narrative.
But low and behold, Resistance 3 saves us. We see Capelli has a family now, and that all he wants is to live happily ever after with them. But of course he can't on account of the Chimera. The fact that Capelli refuses to go off and save the world is a nice touch as it makes him far more human than just having him set his jaw into the default Manly Scowl of Manliness and stomping off with gun in hand. Because we see his family, it means something when Capelli has nightmares about losing them. The fact that *again, spoilers* Capelli convinces himself they are in danger and puts the mission in jeopardy because of it feels like it's setting up some big 'drama' moment, but it never comes. It turns out Capelli's dream was just that, a dream. I liked that.
Then there's New York. I honestly do love that scene to bits. When Capelli staggers into a radio station and confesses to the world his belief that he is going to die, and how much he loved his family, I was really moved. His last line in particular: "Tell my wife I love her. Tell my son... I loved him." Right there, at that moment, you can see Capelli has accepted his own death.
To me, Resistance 3 seemed to get back to what makes a good story; a protagonist we can relate to, struggling for a goal we can understand. Saving the world is all well and good, but saving the people you love? That is so much better.
The TL;DR version is this: Big explosions and snatching the controller out of my hands do not make me care about a game. Show, don't tell, is the cardinal rule; less is more being the follow-up. The more we learn about the Chimera, the less frightening they are. The more we see them fail, the less frightening they are.
The Alien franchise has suffered the same way; it was frightening because it was unknown. Now, we know so much about the Xenomorphs it's getting really hard to come up with plausible reasons why they don't just nuke from orbit and save us six hours of sub-par gaming...