I think a lot of parody games are pretty sub-par koikatsu models with default animations. The ones that actually emulate the main series artstyles are the ones that I tend to enjoy.
I think a good 2D artstyle can blow a 3D model out of the water any day of the week -- unfortunately, it's a lot less common to find a good 2D game than it is to find a decent 3D game.
Yeah I think this depends entirely on the character and how well the hair is done. Pubic hair is fine for the most part, but armpit hair (and more) is pretty off-putting!