I actually rather like the 2d sprites/animations in the 3d world. With some adjustment (such as changing the sprite to another which would be drawn at an angle when the player looks too far up or down) the game would maintain a rather unique visual style. To be honest, the artwork is one of the things I like best.
Aside from that, maintaining the simplicity of the core gameplay and refining it to where it is first and foremost enjoyable to play seems like a good idea, and as far as that goes things seem to be right on track.
Anyway, I will of course be following this game from now on. I was pleasantly surprised to find it again after some time, thinking it an entirely new game from the one I had bookmarked quite some time ago now. I wanted to comment because I really like what you are doing and hoped to express that as well as provide a bit of encouragement. Keep it up! (´ ▽ `)ﾉ