So I'll take the challenge and play Devil's advocate for a bit.
The Kickstarter raised nearly $2 million dollars. That's a nice sum for Kickstarter, but it's not even close to the realm of funding a AAA game.
The innovation here is that Garriott is attempting to create a near-AAA game solely through crowdfunding. And he appears to be succeeding. In this update, they revealed that in the year since the Kickstarter ended, they have more than doubled their Kickstarter amount, with over $4 million in total funding. And this update shows they are hungry for more, as they introduce new tiers to keep the cashflow coming.
It's an incredibly ballsy business move. They're effectively paying their staff in pay-as-you-go fashion, creating a constant stream of in-game assets that people can buy with real money, which is used to pay for the development of the actual game in real time. And the resources to create these in-game items are likely very small; probably one full-time 3-D artist cranking out new pieces on a weekly basis that will generate hundreds or thousands of sales.
This game isn't an old-school-influenced Wasteland 2 or Pillars of Eternity. This is a full 3-D game, with an over-the-shoulder perspective of a fully customized character, with 3-D graphical representation of every weapon and armor in the game. The art assets for a fully 3-D game like this are staggering, and shouldn't be possible through crowdfunding. But that's exactly what they're trying to do, conventional wisdom be damned...
I've played some of the release versions, and there really is a game shaping up underneath all the fundraising. There are quest-givers that lead you to dungeons, where you fight monsters with powers from a skill tree, and find secret doors with chests behind them that contain unique weapons and armor. I've also crafted a few items. Obviously, this is alpha, but my point is that I haven't done anything with house buying or decorating, but I see potential.
The main thing folks here will have to get past is walking into a town, and seeing row upon row of player housing, and spending time trying to find the "real" part of town with a tavern, store, NPCs, etc. Once I got used to all these houses, and knew what they looked like so I stopped clicking on every sign in front of them, they were easily ignored in favor of the "real" town buildings.
Garriott claims he's worked hard with Tracy Hickman on a good story, and I see no reason not to believe him. He's also made it clear that one can play the game offline if we choose, and I see no indication that they are reneging on that commitment. But in-game assets for an online game sell for good money (go figure), so it makes sense that this would be their primary method of fund-raising (almost like an early access F2P system).
We can laugh at their fund-raising method all we want, but the fund-raising can be orthogonal to the actual game design. Personally, I think it's too early to discount the game's quality based on their method of raising cash...