My thoughts on all this:
1. Planescape:Torment still has the best writing and story of any CRPG ever made. Not only that, but dialogue was part of the game. If you got to big defining conversations (like the one with Ravel) then the dialogue options you chose closed paths off, and affected the flow of the dialogue. It actually seemed like a real conversation.
Modern CRPGs have lost this. Your conversation choices don't matter, and what you say doesn't matter, because you can just scroll through all the options in any order. Its just a menu of things to knock off one by one.
No-one else has done this, because they haven't invested the resources in writing staff, and because they refuse to design conversation trees where you can't access all the content.
I do not blame the developers for this much, I blame the consumers. I do not think developers are wrong in their gamble that the big market is in games that can be played on consoles, and that don't require a ton of reading, and where the dialog can be safely clicked through and ignored without missing anything important and affecting the plot. Those of us with the patience to read do not represent a big enough market.
2. I loved Kotor1. The big Reveal moment was one of my Favorite Gaming moments of all time. NWN2 was fantastic too, in part because of modability. This is something that the latest games (Dragon age and Mass Effect) have dropped. Some of the user-created campaigns were as good as the main product. [Go play the Sublety of Thay, for example.]
We don't seem to have this with the new games.
3. The biggest weakness of the latest crop of games is that they are designed to be console games too. Console gamers are a very different market for PC games. This is at the core of the new game design. Modding is unimportant. Text is less important. Combat is more important. Real character decisions are gone - the moral decisions in Dragon Age are of the "Do I kill and eat the kitten, or not?" variety. Mass Effect 1 was a bit better in terms of a few "pro-human/pro-alien" things (I liked the final decisions about whether to save the Council at the cost of human lives), but not much.
Graphics have become everything. This has driven the Fallout3 games; the games look great and they're fun to explore, but there are few interesting decisions to make other than "where shall I go today" and the combat has lost its tactical elements and any real difficulty.
4. Bioware is still probably the best studio out there. They're making good games, better than other players out there. These games are fun. But not great games.
I suspect that as long as the PC RPG market is as small as it is, relative to consoles, we're unlikely to see more games like those we idolized.
The other culprit is MMOs. These are driving RPG development. This is where the players are, and the money is, as far as PC RPGs. Why develop a game with a fantastic plot, when you can develop an online monstrosity and keep people playing it again and again, without caring that there is no real plot?
5. I do think we do over-state the greatness of some of the games past.
Torment was still largely run on rails.
NWN2 didn't really have any particularly deep moral decisions.
Kotor2 just wasn't finished.
Icewind dale plots were very dull and formulaic.
Honestly, what I'm most excited about these days is the new Deus Ex game. But I'm not holding my breath.
*edit*
I found Dragon Age fun at first, but rapidly got old.
I like the origin stories. They were fun, they had good writing. But then things got dull.
The ending was terrible. No plot twist, nothing unexpected, one of the most boring villains ever. The whole game has the villain who is a big monster who can't even talk. No motivations, no personality, no character. Blegh.