I've heard of people who started with fable 2 who think it's improving.
The rest of us (i.e. upset fanboys) think it's getting adding failed features and nonchalantly removing the good ones.
Having it move to an industrial era gets it into a dead end unless it feels like continuing to go forward until modern times. The first was set in some kinda pseudo magic medieval time, and they could've continued that without problem, and Fable 2's setting seemed like a good idea, but it has worked them into a corner.
Fable's controls weren't one button for everything so fighting was actually interesting, and death actually happened.
Fable 2 introduced nice features, but was a sign of more streamlining to come. Celebrity voices was a nice extra. In it your community service could be killing a troll.
Fable 3 had too many celebrity voices, and didn't even have trolls, one of it's iconic enemies. It has about 6 species of enemy, and practically no such thing as a boss. Everything was a legendary weapon which made it far less rewarding. There were very few clothes, and I didn't like the hairstyles. To get BLACK dye you had to get DLC. Being evil doesn't make your eyes glow red and have horns, it just makes you look like an emo vampire. Only the side quests in this game made me feel the Fableness. You don't even start as a child in this game, and the player character voice acting makes it easier for the game ot misenterperet your motivation.
Fable 1 had an cool evil antagonoist. 2 and 3 just have evil rich people.