In a word, yay! This is by far the best of the prequels (and I really liked Attack of the Clones), and aside from a couple of hiccups it could be the best of the entire saga.
Covering the biggest criticisms first, Lucas can't write dialog for a love scene to save his life. This is unfortunate, but nowhere near as bad as in Attack of the Clones. The acting has improved some also. Hayden Christianson does a better job with angry than with angst, so this movie is better suited for him.
There's one scene- and a climactic one at that- where Palpatine's makeup is so bad that it almost ruins the scene! There was some laughter in the audience. Not a good sign, given the dark nature of what was happening.
Concluding the bad stuff, there are a few plot points that seem somewhat rushed, particularly regarding the fall of Anakin. This is less the case when you realize that the movie takes place over the course of several months, which isn't strongly emphasized. Given that this movie had a lot of ground to bridge to tie the prequels into the original trilogy, they overall did a surprisingly good job. They also fit in tons of little bitty stylistic bridges
Now the fun stuff. Given that everyone knows how this movie ends, they still managed to throw in a few surprises and make you care about what's happening. Just as importantly, Lucas clearly listened to some of the feedback and criticisms of the earlier films, and managed to neatly address several nit-picky gripes, inconsistencies and plot holes in a smooth and sensible manner, making things that seemed incompatible between the two trilogies mesh seamlessly. The last act of the movie in particular is filled with "ah hah!" moments.
This movie is dark. Dark dark dark. A lot of bad things happen to a lot of good people, and some of it is almost painful to watch (as it should be). BTW, gsaberrealisticcombat=1. If you've played Jedi Knight 2 you'll understand what that means. Good job, George.
Hands down, this is R2-D2's best movie. He get a lot of screen time and takes full advantage of it. I was seven years old when the original Star Wars came out, and R2 was my favorite character. I got the same feeling all over again. :-)
Likewise, the relationship between Obi Wan and Anakin is much better-developed, and less adversarial (at least at first, of course). Anakin's character has clearly grown since Episode II, and he's lost a lot of his whininess (thank God!). Obi Wan speaks highly of Anakin in A New Hope, and now that doesn't seem contrived at all.
There's really no need to get into the special effects much. The bar has been raised to the point that everyone expects them to be breathtaking. They are. `Nuff said. Likewise, all of the lightsaber duels and other action scenes are top-notch.
Samuel L Jackson requested that Lucas make Mace Windu's death appropriately bad ass for a warrior of his stature. He got his wish.
Obi Wan also proves that he's a bad ass.
But not as much as Yoda, who continues to prove his Master Ass-Whupper status. For a little green CGI muppet, he exhibits surprising screen presence! :-)
On the other end of the spectrum, yes, Jar Jar Binks is in this one. However, his screen time is very minimal, and - here's the best part - he doesn't say a word!!! YAY!!!
The Darth Vader we grew up with, with the black armor and the heavy breathing, really only has one significant scene. :-(
You learn a couple of interesting things about the psychology of clone troopers. I'll leave it at that.
A couple of cultural observations about the Star Wars universe:
1) It seems that there is a social convention against asking any kind of probing questions regarding pregnancy.
2) Astromech droids are always at the bottom of the target priority list.
So the executive summary is that the movie isn't perfect, but it's the best of the prequels and does a surprisingly good job of tying the series together. Oh the whole I like it better than any of the other movies in the saga, despite a couple of weak points.
By the way, I'd like to get some thoughts regarding a theory Kim has. This actually has little to do with Episode III. We were just speculating in the car.
The theory is this: In Attack of the Clones, Padme is originally seemed rather put off by Anakin. He really wants her, however, and for seemingly unknown reasons she quickly falls for him. Given that he's the Chosen One, strong with the Force, yadda yadda yadda, could it be that he willed her into loving him? Just a thought.