One thing that always struck me about the game was the UI: it was functional, took little time to navigate, and had a bunch of helpful notes for new people, but it looked completely inappropriate for the setting. The big, friendly blue buttons seemed to be something out of an uninspired science fiction game.
The music suffered from some of the same unnatural tendencies. I was not looking for an orchestra, but the music in Hommlet just made the place seem dull and dead. Then again, with all the "lively" NPC activity, engrossing quests, and appropriate ambient noise, maybe that was what they were going for. Maybe Hommlet worked in a PnP setting, but I think ToEE would have been greatly improved by removing it. The game was built around combat and it shows. There wasn't any great need to wedge this tedium into the game for the sake of a narrative. Every resource spent on Hommlet should have been invested into the core of the game: granting more enemy diversity (I think the game had quite a bit, but it was not distributed well), more interesting encounters, more jiggle animations on Zuggtmoy, etc.
It really failed to provide anything of value. NPCs for hire could have been relocated or removed entirely, and the shops could have used a similar treatment. I understand that its purpose is to provide a good party with something to do aside from engaging in genocide against evil, but once you get into the meat of the game you are finished with Hommlet. More than likely you have already forgotten everything you did in Hommlet. You have also forgotten how to spell Hommlet. The only reason to visit this village is to stop at the Inn or sell your plunder. A better social engagement for good parties would be to provide more temptation to do evil.
I could talk about the promise of the engine or how fun the combat can be, but that is obvious. Overall, I like ToEE quite a lot, but the negative bits always jump out at me--no matter how superficial they are.
And no, I have never used the Co8 mod, but by the sounds of things I missed a lot.