It's really simple. The writing quality declines.
I'm not talking about the writing of individual scenes and encounters, etc which remains great. I'm talking about the larger picture, the big story arcs. The first two acts have central, unifying story arcs that drive the experience. As you progress, the tension rises and the stakes get higher. This is a classic narrative structure which keeps the experienced focused and fun. Because our brains are wired to process narrative.
Yes, there are plenty of side quests and different ways to do to central stories, sure, but those central stories and conflicts still exist.
By the time you come to Baldur's Gate in Act 3, it's not like that. Most everything is effectively a series of unconnected side quests. In fact, Act 3 does what the game is lauded for NOT doing in Acts 1 and 2: it's basically a series of unconnected fetch quests. Without a unifying story arc everything feels pointless and random and, in the end, tedious. And you get bored. And you restart and do Acts 1 and 2 again, even though you know them intimately, because they have that structure which your brain craves.
