Diablo I was indeed unsettling, the soundtrack really assisted in that feeling well throughout the game. The enemies are done well and the bosses are intimidating to boot.
Diablo II kept up the horror but you could tell the action overtakes the theme a bit, because you're clearing mobs of enemies.
Diablo III is completely all action than horror. I've got a character that just mowed through enemies with barely a thought so there wasn't much time to sit and think of the theme.
As much as I adore, love and still prop Gen II as peak pokemon. I also have to blame Gen II for bringing in EV and IV that has served for the longest time, as fuel to the fire. Additionally so has making pokemon born and all that.
Now there's mega-evolutions, old pokemon have aurora forms or whatever. Why complicate it?
While I agree that some of the reasons are because of industry direction and affordability. I do have to mention also that it could also be because of nostalgia, familiarity, simplicity and people still chipping at their library.