They didn't fix what was broken, ie loading times and finding levels.
They broke what was working, the campaign levels. I could not get through the campaign in LBP3 with my kids because of the annoying hub design. Impossible with everyone going in different directions.

Mario maker fixed a few things to the formula, load times and easy level design.
Yet it's still too hard to find good levels and the x Mario challenge is the worst game design.

I don't know why it's so hard for these games to find the levels you like. Amazon and Netflix know what books and movies I like, why can't these games use the same correlation metrics.

It is, but so was LBP, frankly.  They wanted to do more with LBP's engine, but realized they needed more horsepower.  Remember, since LBP2, all MM's done is Tearaway and the Remaster.  And Tearaway didn't take all of MM, I don't believe.  They've been working on Dreams for quite some time.  Like LBP I do think there will be a game that comes with the tools.  This will really allow you to create pretty much anything though.

Little big planet was a quirky, original title. It's interesting the first time, the second expanded it, but from there on its the same and has to start living on its own merits, and its where it stumbles.
I could also argue that it doesnt have the preciseveness of mario gameplay (its too floaty) and doesnt have the same visual appeal (very brown and dark pallete). The puppetshow art style isn't very appealing to the masses. You need to give them colorful envyronments and characters with immediatly fun acessable gameplay.

LBP 3 felt lifeless to me

One of the best games last gen but it failed to make a big advancement, I think they have to go 3D to wow people again.

Level creation is the key of Littlebigplanet success,there's not enough major new functionality in level creator on LBP2 and 3 to justify buying them.

Well, Mario Maker may be a level creator, but it made you say "WOW!". For LBP3, a lot of people looked at the level creator, but not with such amazement.

It's not like the franchise sucks. It's pretty fun. I just guess it wasn't as memorable as a plumber who manages to be a superhero

The games were lame

I guess LBP3 had trouble expanding upon the sequel hoenstly.

LBP3 is not made by media molecule they do dreams now. At some point Sony will always decide to make a new IP with a studio, thats how they always have been. Sales and critics didnt matter at all