It is hard to start writing about this topic; that is because of several reasons, though one dominates the others: The current video game industry has faded away from imaginative games that much that it is hard no to lose any direction about how to go on. So let me start by simply introducing what said imagination is.
To me, 3D is where everyone´s imagination ran wild. Be it developers, that created these games, or consumers, that gladly bought them. Imagination in terms of video games is not about using a lot of colors or quirky gameplay-features. It is true that my biggest complain about modern, popular video games is that they´re all dark, “cool” shooters or otherwise violent games, with a lot of nice-to-watch cutscenes. These games are missing any kind of imagination, but adding colors isn´t a solution.
Imaginative game design is about creating games that succeed to feature gameplay, level-design, characters and stories that can hold up by themselves. Games that don´t need, or rather, don´t care about popular existing concepts. Other media, like movies or anime, are much better at being imaginative. I´d recommend for you to look into Dennou Coil, Haibane Renmei or Fantastic Children. These anime-shows are that rich of unique, fresh imagination that it´s painful once it´s over. One really great example of such a game was and is the Pokemon-series. Surely, it´s become beyond popular, but when it was released in 1998 (European release), it didn´t care about any other media. There were no movies, books, or games that featured the same spirit as the Pokemon-games. Catch uniquely designed monsters that you have to train to become the best trainer in that peaceful world. Another example would be ICO, that didn´t give a damn about popular design choices. Explore a forsaken castle, help a mysterious girl and fight creepy shadow-monsters. Without a HUD or inventory or mission goals. And then we have my personal pinnacle of imagination that is the Zelda-series. No other popular series continues to shrug off popular design choices like the Zelda-games. These games don´t try to be cool or angsty, they´re not about hardcore-challenge and they´re featuring the weirdest atmosphere in any video games. Exception is Twilight Princess, which unfortunately took design choices of the Lord of the Rings, which may be one reason for why many felt that entry lacked…something.
There are many, many other imaginative games, be it Spyro, Gex: Enter the Gecko or Banjo-Kazooie, but the bottom line is: There was a time in gaming when games dared to be imaginative. Be different. Be themselves. Now, you can hardly find such games, and most of them are smallish download-games that don´t feature the high quality of a big budget game. There are a lot of reasons about why the gaming industry is the way it is today, but at the end it is us, the gamers, that lost something precious. And I have a hard time thinking of something games-related that´s more important than imagination. This industry is headed towards a Hollywood 2.0, and it is both the fault of developers that want to be directors, and gamers that only buy into these huge, massively hyped cinematic games, that things are the way they are. When this years Game of the Year-awards are over, you´ll see them filled with Modern Warfare 2, Uncharted 2 and other titles along these lines. It is the masses that want such a world, but I can but shed an invisible tear about what has become of the world of video games.