Sir Ridley said:
The puppet is pretty great otherwise, but the mouth is so important for his appearance. It looks like he lost his teeth.Hence my argument that a muppet should be used for Yoda, but with CGI mouth movements. In fact, I see no reason the same approach couldn’t be taken with a host of characters that are either animatronics or actors with prosthetics. The Nemoidians are examples of the latter, and while they were lame characters anyway, because of the writing, at the very least they would have looked better if their mouths had been animated.
The Neimoidians were originally meant to be CGI using the design that was eventually used for the Geonosians (hence why the battle droids resemble them). However, despite what the special features might have you believe, CGI was not all-powerful in 1999, so they had to make them with masks. Maybe they had simply blown the budget on Watto and the Gungans?