Dir: George Lucas
There are a variety of reasons that this is the case, but many can be traced back to the fact that the groundwork laid in the first two entries in Star Wars' prequel trilogy is so poor that even though this is in many ways a much better film, it is still almost fatally hobbled by earlier poor decisions (well, that and George Lucas continued vacillation from bald exposition to laughably bad 'serious' dialogue). As I said in the Episode 2 review, Anakin's journey to the dark side in that film comes off as a teenage strop (something that even the supposedly darkest moments of this film also suffer from, thanks to the terrible dialogue and delivery), and that means that when he goes to darker places - like murdering a temple full of children in cold blood - I just don't buy it. Of course this is also due to Hayden Christensen's laughable performance, in which he mistakes scowling and talking through his teeth for a deep darkness of the soul.
It's a pity that the writing and performance so undermine the story, because for all the criticism you can level at George Lucas as a writer, the overall shape of Episode 3 isn't bad. He sets up the way that Anakin is drawn to the dark side - through promises that he can gain the power to save Padme, who is now pregnant, and whose death in childbirth he has been seeing in his dreams - in reasonably convincing fashion, benefiting from a reptilian, if sometimes overly campy, performance from Ian McDiarmid. The muddy sense of good and evil is also a potentially interesting avenue, but again Lucas' schematic writing strips it of effect and bludgeons you with the point (Anakin whining "From my point of view the Jedi are evil").
Another way that the earlier films conspire against this one is seen in Obi Wan's story, as he is sent to pursue General Greivous, leader of the droid army. Greivous is a new character in this installment, and thus he carries little weight, had Lucas not killed off Darth Maul in so perfunctory a fashion in Episode 1 this storyline could have had real purpose in terms of Obi Wan's character arc; killing the Sith that killed his master rhyming thematically with the loss of his apprentice to the dark side, but instead we get to watch Obi Wan chase an asthmatic (?!) robot across the galaxy in an arc that seems designed merely to keep him out of the way. Also shunted to the side, after showing some ability to kick arse in the previous film, is Natalie Portman, whose role this time is merely to be pregnant and look winsome.
As I said though, the overall shape of the film works, and though details clunk (Padme dies of dramatic irony, C3PO's memory is wiped in a retcon that shows how little his presence adds to the prequels beyond fan service), Lucas does manage to draw together a lot of very disparate strands in a way that leads somewhat naturally into the original trilogy.
Individual sequences also work well, some even brilliantly. Order 66, which sees the clone armies turn on the Jedi, is executed in grand scale, with a montage of death that is almost Godfather-esque (yep, I went there). This is when the enormity of the power of Palpatine and the Sith hits home and when, for all the terrible elements, the plodding setup of the first two films does pay off to some degree, because it's when you can see just how meticulous and long standing Palpatine's plan has been. The other great sequence is the battle between Obi Wan and Anakin, again, It's easy to wish the setup had been better, and the one tone backdrop of a planet that seems to be entirely lava can be rather dull, but the fight itself is great. McGregor and Christensen throw themselves into it; it's fast and exciting and varied enough that it can sustain a ten minute plus running time. This sequence also features some of McGregor's best acting work in the series, you believe how broken Obi Wan is to see how deeply he has failed. Unfortunately the other side of these moments features Christensen at his worst, the scream of "I hate you" should come loaded with so much baggage, but it still just sounds like a six year old kicking his toys at his Dad.
Once again though, for every thing that works, several don't. Many potentially good scenes are marred by awful dialogue and performances. Take the scene in Palpatine's office that is the real birth of Darth Vader, in which Ian McDiarmid's hissing villain goes from subtly playing on Anakin's weakness to full on panto villain in seconds. It doesn't work, and when I was supposed to be feeling foreboding at the birth of the Emperor, I was in fact giggling and trying to decide which of the digital effects on his face or McDiarmid's performance were the lowpoint of the scene.
Let's imagine for a moment that Episode 3 were just about perfect; that Christensen came into his own and oozed menace, that the romantic dialogue between him and Portman made you believe in and root for that relationship, that the action and the politics were perfectly balanced. All that could be true, and the first moment we see Darth Vader in his iconic costume would still ruin the film. The first problem is one of size. Vader is an imposing figure, but here he looks tiny, as if the scene had been shot with a toy, but the crowning embarrassment - the moment that sums up the way that the prequel trilogy as a whole shits on the legacy of the first three films - is when Vader lurches from his shackles and shouts "NOOOOOOOO". In this moment the betrayal of one of the coolest villains in cinema is complete, the prospect of him ever being menacing removed. Even as someone who isn't a huge Star Wars fan, watching this moment is like watching the death of my childhood.
So yes, this is the best of the Star Wars prequels, but that's really an all but meaningless standard, and by any other standard it's not a good film. There is a good film somewhere in the prequels, but it's buried under a mountain of bad decisions, and a system's unwillingness to tell George Lucas that you can write this shit, but you sure can't say it.