This one is weird. I like everything about it more than the first game, except for one thing. The structure. I didn't enjoy having to grind out the three starting dungeons over and over to get materials to build the castle. Other than that, the game improves on the original in nearly every way. It's just as strategic, just as fun, the characters have even more personality, there's a larger variety of items and enemies.. The castle is really the only reason I slightly prefer the original Shiren. Still, totally worth playing.

It's a crime that this game never officially made it out of Japan, but now with the excellent fan translation, there's no barrier for anyone who wants to play this masterpiece.
All the good systems of Mystery Dungeon, though with reliance on metaprogression, your objective at the beginning is to obtain materials to build a castle, these materials are found on dungeon runs and they vary between 3 levels of quality that determine how strong the castle parts will be. There are 3 dungeon paths at the beginning, and they're basically Easy, Normal, and Hard modes, with the best materials found only on the hardest one.
The game starts out very simple on the easy path, with all items being identified, a lack of cursed equipment, and few monsters with especial attacks or gimmicks, after you beat it you unlock the medium path where you get more mechanics to handle, and once you unlock the hard path, the only Mystery Dungeon mechanic that it won't have will be monster houses (which you will find in the last dungeon). This form of progression is a great way for new players to get used to the gameplay, and since the path's difficulties are based on what mechanics, map generation, number of floors (and boss fights) and monster types you'll find instead of levels (so fully naked level 1 hard runs are perfectly doable), once you unlock the hard path you never need to go to the other two unless you don't care about getting weaker materials and you simply want to sprint as fast as possible through the game.
You also get party members as the castle is built and the story advances, every character is unique and has a special skill that can greatly help you with good positioning and smart playing.
The music is fantastic, while some of the songs are reused themes from shiren 1, they're remade and feel fresh with the superior sounds of the n64 compared to the snes.
As of writing i'm still finishing building the final parts of the castle and it has been a blast, i haven't even gotten fully into the side content like the weapon and shield wall collection, the full golden castle and decorations, the several extra dungeons you unlock later in the game, and the monster companion collection and zoo that comes later.
You can't go wrong when choosing to play this game, even if you're not a Mystery Dungeon or a roguelike veteran (i've found it a little bit on the easy side myself, though it's not a cakewalk at all), the game has a lot to offer.