Its alright/good (when playing the japanese version.) If you hated 2's gimmicky levels, there's way less of that there. Hate 1's difficulty? Hmmm..... Its still there kind of, but one major thing is enemies don't respawn.
Bosses are a lot easier I felt. Still a hard game, but not as hard as NG1..... or I would say if it weren't for the timer. With later levels, I felt like I always timeout until I die to start over from the last section TO the boss with more time left.

So yeah. Better than 2, still not as cool as 1 I felt, which is fine. For the love of god, avoid the pure american release if you don't want NG3 Ryu Must Die mode