Both Ultima VI and VII are divisive points for series fans. The issue comes down to what level of detail and scale is really desired.

The earlier games do a better job of staying coherent to their main questlines: while there's some NPC interaction, you're expected to be in puzzle-solving mode for the bulk of it, looking for hints to the next item or location. This presentation of the game as a "solvable puzzle" was the norm for 80's gameplay, since the capacity for simulation was so limited.

With VI, suddenly the gameplay occurs at a single uniform scale and camera perspective. It's still using tiling compression to achieve that scale, so there is visible repetition, but the effect is that now it's easy to get lost. This is carried forward into the interactions, which now have a larger depth and persistence to them, and not everything is puzzle-centric. Ultima VI is coherent to Origin's motto of the time, "we create worlds", but at the expense of being a consistent "questing" experience. The increase in detail rather adds new "and now the hero must go to the toilet" style moments that break with the scenario.

Ultima VII just goes even farther down this path - it's very much a world, to the point of still rivaling AAA experiences of more recent years, albeit at a fraction of the graphical fidelity, with the absolute minimum of animation that could suffice. Playing it for long periods can leave you with a headache because the perspective and scale and detail combine into composited scenes of dense, tiny pixel blobs all representing various objects - the eye never gets a chance to rest. While the game is not overtly that tricky, it still draws on many of the tropes of older RPGs in this highly detailed setting, which adds a sense of unease: Sometimes a thing triggers in a dungeon and you're just not quite sure if it was a programming bug or it was intended as a trap.

And it's so hard to stay focused on the main quest in VII without being systematic about it that most players will likely have their fill long before that. Besides the issue of getting lost and having trouble finding an NPC when they move around on a schedule, there's still no quest tracking(this just wasn't a thing yet), but it does automatically give you keyword topics, so you can blunder around, trigger a lot of things and then forget what happened, where previously you were going to have to take notes anyway just to know what topics to type in.

And Ultima VII has some of the simplest, least gratifying combat in the series - there's no more turn-taking and it nearly plays itself, with the tactical decision making coming mostly in preparation and various gimmickry with the engine. The combat is a small element supporting the world instead of a definite thing explored on its own terms.

Lastly, in a literal sense Britannia started getting smaller with VI and VII, when you look at how much the towns are getting crammed together. The sense of "travel" isn't there because the landscape is truncated.

So in that light, VIII is a continuation of several trends. It's more graphically intense(actual animation now), but it made further cuts to the RPG framework, and further pushed the detail instead of the overall worldbuilding scope.

I think the main issue Ultima had with these later games was with making the increased detail cohere well. It made the programming more fragile, stretched the asset counts, and pushed people's PCs to the limit while being less of a straightforward dungeon crawl each time and a little more of a tech demo, and then with VIII finally hitting a point where the production process didn't get to fully flesh it out. The baton of detailed worldbuilding was passed to Ultima Online, which I do think deserved all its success.