3D is bad for Pokemon because it leaves nothing to the imagination. In older games, the battle screen was just an abstraction representation of the actual battle that you were meant to imagine yourself. The same applied to the overworld, you imagined a bigger and more lively world than what was shown on-screen.

Sprites also left it to the player's imagination how the Pokemon moved and attacked, and the lack of detailed backgrounds also helped this. By avoiding the place where these fights occur, the player won’t ask the question “Why are they just standing there? Why isn’t something happening in the background? Why can’t we move around?” But when you have a fully-rendered 3D background, it becomes harder to justify why the Pokemon aren't moving.

There is no imagination anymore. 3D graphics cause us to think that the world really is that small and that the Pokemon really are just standing there.