Well, the game storywise was quite underwhelming. There were basically 2 plot points in the whole game, rescue Shenhua's father(which was kinda established in SII and in interviews) and the whole ending twist with Niao Sun.
I don't really mind the lack of plot points, hell Shenmue I disk 1 and 3 are just padding (all you need of disk one is Zhu's letter, getting the mirror and knowing that Lan Di went to Hong Kong, most of that is developed on disk 2), in Shenmue 2 the main narrative driver is finding Zhu, and the whole Guilin segment.
But in both games stuff happens, in SI you learn the mythology of the mirrors, learn that Lan Di is part of a mafia, you save Nozomi, learn about the secret past of your father in China, you get scammed, you have to get a job, you take a full gang.
In Shenmue 2 same, you learn about the Wude, you learn about Xiuying's brother, you befriend Ren, you take the yellowheads and learn they were working for Lan Di, you meet Shenhua, etc.
One of the problems in S3 narrative is that it's incredibly artificial, the game progress is basically "defeat that guy that is overpowered" (even if gameplay wise I was beating their ass), and I don't think the games makes you earn that moment.
Both are gated behind a paywall, Sun's segment makes it work it a little bit more because the character is a little more developed (even if it's the drunk master cliche), but then the fisherman segment... the way of mastering kung fu is... buying a scroll... That is almost the same as the move taught by Sun...
Compare it with Shenmue 2 teaching of wude, the not-blind musician, catching leaves, they all felt like life lessons, and the last move of Ryo clearing his mind feels deserved, and show's Ryo growing as a martial artist but also as a person.
In S3 the end boss is muscle guy (I can't remember his name even), and that is basically the whole definition of his character (which is also the same definition of the previous boss, but with goofy hair).
That drives me to the other point which is that S3 simply doesn't have many good characters, hell side characters like the rich couple are more developed that the main characters, "fat guy" "broom girl" "fisherman" "the guy that knew Iwao and Zhao but dissapears", there was this amazing world that I was hoping for something to happen and develop the characters, but it never happened. There was this amazing temple on the water, grab a paper (that as far as I know doesn't do anything), you meet the broom girl, and there's that for the whole place, go to the next temple, look for names, and get a scroll by a guy that apparently also knew Iwao, and nothing happens ever again, what was the point ?
There were so many beautiful places in Niaowu, but storywise not much happens, it was great for sidequests and stuff to do and look at, but the whole S3 story and characters feel underdeveloped.
Not only that, but that the trailers basically spoiled all the "good parts", I knew that the boat girl was Niao Sun the moment I saw her, but even then it, from a narrative point, doesn't matter in the least (Shenhua could have been kidnapped by anyone IMO).
I liked the development that Ren took in the game, specially towards the last part, despite what many of here think, I like him sticking out for Ryo and showing he's actually a good fighter (he's the leader of the Heavens after all), he showed a little bit of that side at the end of S2, while still being kinda lazy and arrogant, maybe I like him because it was more Guizang-like.
But yeah, I feel that most characters were just really underdeveloped, even minor characters like shozo feel less one-dimensional than the main characters of S3. The only one that felt more developed was Shenhua (even it hinted more about the game in throwaway conversations at the end of the day than most of the main plot).
It's weird, because I think that the game is actually great, I think it was a great balance between Shenmue 1 and 2, even there were many improvements, but the narrative wasn't up to par. While I was enjoying the minute to minute gameplay, the moment it said I was leaving Niaowu made me sunk in how little of the story I was told, and I felt like it was 80% padding with little narrative output and made me wonder what I "really" got of it, and I feel that condensing the story would have made the overall feeling of the game better (of course, if we got more of it).