I haven't played Super Mario Sunshine, but I've seen a bunch of playthroughs of it, and would personally love to try it out sometime. From what I know, it's been kind of in the same situation as Wind Waker was, where one half of the fanbase practically worshiped the game, and the other hated it to death. And I can definitely understand both sides, since I reckon a lot of the haters were hoping for a new Super Mario 64 game, and instead received this. I mean, F.L.U.D.D definitely does seem out of place, but I feel like the decision to make Mario Sunshine as it is, is kinda what defines Nintendo. They try to be innovative and present some new and features each time (for the most part, since New Super Mario Bros. is pretty much the Nintendo equivalent of CoD :p), with most of the hate mainly being generated from the fact that the game isn't like the old used to be. I'm pretty sure Super Mario 64 also got some backlash because of how far it ventured off from the 2D platforming formula, but I doubt it was on the same scale, considering how it was a step that most people could agree on being in the right direction. But with Sunshine they didn't venture into another realm, but rather altered with the mechanics that people already knew and loved, where some welcomed the change, and some just despised it.
Of course I can't say anything for certain, but that's just what I've really come to notice. As for a sequel; I don't know about a direct sequel, since the idea already seems to have been abandoned, but I'd love to see a return to Delfino Isle at some point. And the whole game revolved around Bowser Jr. or w/e he's called trying to kidnap Peach because he believed she was his mother, and Bowser already explained that wasn't the case, so yeah. Can't really see anything like that happening :p I'd love to see him make a return though, just with another storyline :p