I do enjoy all the new features in the third generation. However, G/S/C will always be my favorite. Perhaps it was just because of its timing. What with all the hype of the fad surrounding its release, the relative crappiness of R/B/Y, and the very first set of new Pokemon, the second generation seemed like a gift from the heavens. Playing it was magical too. From the engaging, day/night/days of the week system, to its then superior graphics, second generation played great.
It succeded in ways that went beyond mechanics too. Johto had, in my opinion, the best feel of any region yet. With its rustic, olden Japanese locals, it was easily better than the generic Kanto, or the tropical Hoenn (despite Hoenn's complexity and diversity.) And then of course there was the story. The story remains the best next to the two Gamecube titles, which sacrificed gameplay to tell a mediocre tale. It had the whole "sequal-thing" helping it, but it felt so great to find Red again, to watch Giovanni's son reek havoc amongst the remnants of his father's team (something that couldn't be appreciated until later) and to see Blue at the Viridian gym. It was everything Red and Blue should've been, and had led up to.
As for the Pokemon themselves, each generation has its own merit. I really couldn't decide. I don't watch the anime, so I can't attest as to Johto's alleged crappiness in that area.