This is one of those shows that exemplifies the direction that anime was going in this decade, and it’s handy to use a show like this to illustrate it, rather than a moe show.
It’s a deceptively popular show because it is targeted at a niche audience that isn’t getting this sort of material anywhere else. The fan chatter around it was huge at the time, and presumably the DVD sales were great because it got multiple sequels and OAVs. However when you look at the TV ratings, they aren’t any better than other late night shows that had less noise made about them. In fact overall, they were kind of on the low side (around 1.0).
So you’ve got this disconnect that’s formed in the industry between what appeals to a mainstream audience & what will shift silly numbers of DVD sales and merchandise. There’s too much chasing after the latter rather than former, which is understandable as it’s a lot easier for find a niche audience and exploit them, than find something everyone likes. With manga sales down it’s harder to find both the niche and the popular within them, so light novels and visual novels seem have become an easier source to find the rich veins of fandom to mine.
And if you’re trying to create completely original anime, you’ve a steep hill to climb without mixed media support (and even with it, you may end up getting a niche audience when you shot for a mainstream one).
A side effect of mining these niches, particularly the light/visual novel niches, is that as long as you get their story right, the fans aren’t that bothered about the visuals. For all its vocal fandom, I don’t think I’ve ever heard fans of this show lavish praise on the animation, which struck me as plain and not particularly inspired.
They just want their Catholic schoolgirl romantic friendship and lesbian undertones, they don’t really want it to entertain as a cartoon. It’s not really anything new, Legend of the Galactic Heroes worked under the same premise, I can’t believe that the folks buying those early episodes of LotGH were getting them for the animation, it was the story that was the selling point.
The problem is that there’s now too much of that sort of approach, and it’s all over TV rather on OAV. This leads to a distorted view of the industry when you just look at a list of available titles like I’m doing now.