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Does it continue the story directly where Longest Journey left it, or does it put a new angle on stuff like when going from Dreamfall to LJ, with new main character and the old one very much changed from as we saw her last? Or is it some kind of reboot, or something else entirely.

Is the gameplay like either one of those, or something completely different again?

I've played both previous ones, the first being a charming journey into a storybook world, a point and click adventure as they were, back in the day. Liked it quite a bit, but no special love.

The second one, a strange hybrid gameplay, stunning visuals, some locations were just wow. Real unappealing sections running about, nicer ones doing puzzlework.
It is a direct sequel to Dreamfall, starting exactly where that ended, with the same protagonists and the same visual (3D) style. The movements controls are also pretty much the same as Dreamfall (and the same as every other 3rd person game in the market), but in order to select and interact with stuff instead of the clumsy "focus beam" that Dreamfall had, in Chapters they just used the standard point-and-click interface (and if there are more than one actions to do with an item/location/person you get a "wheel" to choose between them). Also, Dreamfall:Chapters doesn't have any action or stealth sequences that Dreamfall had, nor does it have any "quicktime events" that some other modern adventures have. One important addition is that now the game has significant dialogue choices that have serious consequences and can even lead to different branching paths in the story (where you'll meet different NPCs, have a different job and different puzzles depending on your choices).
Thanks and +1, sounds like just my thing.