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Paper Mario: The Thousand-Year Door | Nintendo Direct 9.14.2023
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What happened?
When the newest Paper Mario game came out, the developers said in some interviews that the reason the games style completely changed in Sticker Star and beyond is that Nintendo got super protective over how their characters are depicted. They weren't allowed to make their own variations of established Mario-world inhabitants (like a professor Goomba or a pirate Bomb-omb or a purple Kamek named Kammy), they either had to use the characters as they were (such as just "Toad", or just "Kamek") or use their own completely original designs. It's also why none of the recurring characters from past games showed up since Super Paper Mario.
SPM had THE BEST story out of any Mario game ever because of the characters, from my perspective it were the changes to combat and world design that people hated, even though I think it works for the game itself.
Oh I agree on the story. Honestly though, in my opinion SPM still manages to feel more like a Paper Mario game than it's predecessors, because you still had so many returning elements. You had cameos from previous games, series staples like partners and a leveling system, and of course a wonderful story. Sticker Star returned to the 3D RPG format, but sacrificed so much of what made the PM series special and enjoyable.
Basically the upper management was getting mad that Paper Mario was taking on too much of its own identity compared to the broader Mario brand. It's why Origami King is mostly just Toads all over the place.
If that's the case, I guess we have to thank...the Mario movie? For strengthening the core brand more than Paper Mario supposedly weakens it?