what was the last half decent game obsidian made?
Well, Pillars are almost great. First one is undermined by low budget and stretching itself thin with a serious need of 2nd, 3rd or 4th pass, and the sequel is undermined by weak narrative direction with departure of Eric Fenstermaker - Josh Sawyer is great in many things but a good storyteller he is not. Still, overall the most RPG-y RPGs I played in years, and my second favourite Obsidian offering after New Vegas. I would love if they could work with Larian's engine - they would create a magnificent campaign I think.
That said, I think we need new blood. The reason why Larian games are exciting (even if not my cup of tea) is that what they are aiming for is so different then what we expect an RPGs to be. Just as Bioware was back in Baldur's Gate days, Obsidian in it's early days, or Tim Cains offerings. By now we know their tricks, and we demand they make the same game we liked 10-20 years ago, while at the same time expecting them to evoke the same wonder they once did.
While far from perfect, D:OS1&2 and Disco Elysium have been the best RPGs made in years, and not because they are better then competition (I personally don't think they are) but they have fresh ideas and solutions.
And if Josh Sawyer wants to create his bicycle simulator, or medieval historical RPG, I think those have more potential of being new classics then making him works on games that he grew over by now. Biggest issue of PoEs is lack of conviction.
