Fable 3 has some of the best and worst systems on display.
I don't like the way you upgrade/level weapons through purchasing chests on the road to rule, which are unlocked at some arbitrary points in the story. The strength, Stature and Magical Aura stats, however, are implemented so much better since they only improve through the use of weapons. Melee improves your strength, ranged=stature etc, and as each one improves it also affects your characters physical appearance. These changes are so subtle and you're never told about them (unless you check a specific menu). You only really notice the change in the late game when you realise how different your character is (height/bulk) and how much quicker you can kill certain enemies..
In an ideal world I would like Oblivion's stat system, but for all the stats to be invisible. This way you only notice improvements through the gameplay and not by some numbers in a menu.