You do have a point. Lord of the rings is a good example and was done very well, especially with making you feel for the cgi and other non human characters.

This would also explain why you have perhaps as hands worth of fan edits for the original trilogy and about 4 million for the last 3

Well using real muppets might have helped a little in making them (the films) more tolerable

so really my complaint boils down to Lucas not knowing what the hell he was doing or just exposing what a crap director he turned into