Grandia's got flaws, but the major ones have already been enumerated. The problem with Grandia is that it could have been much more - a bit more polish, perhaps, would solve the problems. Giving the game some challenge would have helped immensely. A better soundtrack would have really added to the overall atmosphere, and some of the tedium of gaining experience could have been removed. It's not that the game is intrinsically flawed - it's that the individual parts could have each been improved for the better, and would have solidified the final product.
Grandia is still a highly entertaining game. It's got a fun battle system, it has an interesting world to explore, and it doesn't take itself too seriously. With RPGs branching out into new areas, it's good to have traditional RPGs to play. You know what you're getting, but you don't mind, because it's just fun to play.