While nostalgia certainly has a role in it, I'd say that the original series DOES hold up, to a small extent at least. It does start spiraling downward after the first season, however.
I've seen several of the Pokemon movies, and really, the first one is the only one that is actually worth a damn. Mostly because it has a legitimately threatening villain in Mewtwo, and it's the only time I'm aware of where the ethics of cloning, capturing, and battling Pokemon is called into question.
Really, I think that one of the major problems with the anime is that it IS basically one extended story about Ash. Two other long-running kids anime, Yugioh and Digimon, actually got this right. Each series has separate characters and situations, and only have the mildest connection to each other, if any at all.
Funnily enough, Pokemon seems BUILD for this kind of structure, as each new series of games starts in a new area, with new protagonists. But for some reason, they decided to go with long-running continuity on one character, and I feel the series has stagnated for it.
"But", some of you may say, "What about Pikachu, the series mascot?" Well, they could have handled Pikachu in a similar manner as Yugioh and Digimon. Each series of Yugioh features a Kuriboh of some kind, and each season of Digimon has a kid with goggles. Make it a tradition for one of the main characters to get a Pikachu, or equivelant Pokemon (like Pichu, Plusle/Minun, etc.). Problem solved.
Just my take on it.