I think Kotor 2's storyline and character interaction could use some improvement, I mean the ending was not very fulfilling to me as it provided no closure.
Perhaps another month or two in development might have helped but I realize there was a deadline to keep, so never mind that part.
As far as bugs go, I guess I was one of the few lucky people who haven't experienced very many. I had one incident where the screen went black on me and froze up; I had to restart the game from scratch... <_<
Other than that I didn't find any bugs in the game, and I found it enjoyable enough to play more than once, so I would definitely buy Kotor 3.