What hurt Odin Sphere more, in my opinion, was that the animation quality fell FAR, FAR short of the sprite quality. It was just so jarring. It sounds a bit odd to put it this way, but I'd have probably been less disappointed had the sprite quality been downgraded, and the animations upgraded so that a better balance was struck. Or any kind of balance, really. I understand why they did what they did. Budget. But it still sucked.
That, and the gameplay was incredibly bad too. ;p
Edit - The 2D "monetary problem" is basically as such. It takes a lot more time, effort, and resources to fully animate extremely high quality/high resolution sprites. Basically, almost every single frame has to be drawn manually. The more frames, and the higher the quality, the more time it takes and the more money it costs. 3D animation, in general, is a lot simpler, easier, and cheaper. Once you have the models and animations whipped up, changing artstyles doesn't require near-complete, top-down re-draws either. You just whip up new textures to skin over the existing models and animations.
It's also the reason why Iga and his Castlevania team tend to leave the 2D games to the lower resolution handhelds. They can largely use existing enemy sprites developed throughout the history of the 2D side of the franchise, and regurgitate them into new games. Developing an HD 2D Castlevania is well, well beyond their budget. That's why the GBA and DS got the good ones, and the PS2 and Xbox got the shitty 3D experiments.