3D models were always an awful idea because they'd just make it harder for modders to put out new content, especially total conversions. They also remove the option for deliberately stylized graphics like artistic portraits.
3D models are very much a trade-off, and one of their major disadvantages is increased workload for the 'same' outcome, which affects modders as well as the developers themselves. Making a hat in CKII probably took less than a tenth of the manhours it would take to make one in CKIII. As you point out, they also don't allow for stylized graphics, like those utilized in the
Japan mod for CKII.
My biggest gripe with Paradox's approach to 2D/3D in CKIII is that they're wasting their 3D 'budget' on stuff that doesn't need it. Imagine if, instead of fully devoting themselves to large 'interface' assets, they modelled a single table and a bench. These two pieces of furniture have more potential than their new DLC - now, when you end up at a tavern, you could have three randomly-generated loutish commoners sharing a table in the background. When you feast, the event can depict you as sitting à la the Last Supper, with the disciples instead being prominent vassals. "Wow", you'll think, "Robert d'Ariège sure does look fat and old sitting next to his strapping son." But you don't, since CKIII does a terrible job of showing off anyone who isn't your ruler - the majority of normal events only show you and one other character, and half of the Royal Court (which you never visit) is just random 'wanderers' who have blown in. Playing as the Duke of Bavaria, I saw an obese bare-footed black dwarfette wearing a turban in my Royal Court more times than I saw my own children. If they simply showed more characters in events, had them interact with simple assets, and used background characters where it made sense, it would be much easier to justifying the cost of 3D characters.
Paradox could at least have more variety in children. It's really awkward how it just surges from baby to child to adult, like it feels like one day my daughter just suddenly goes from being a little girl to a grown woman. There really ought to be a division that kicks in, say age 10-16 to "tween/teen" portraits so there's some kind of visual indication that your heir is about to get more events/come of age.
The big advantage of portraying characters in 3D is that gradual changes are much easier, and CKIII does this pretty well. Instead of CKII with its four stages (child/young/adult/elder) with no granularity in between, characters gradually change on a yearly basis. There are three steps (0->3->5->1

instead of the one (0->16) for children, with each year bringing minor changes (slightly taller, facial development) and each step bringing larger changes (wearing adult clothes, beard growth). Adulthood is one single step where characters gradually change. The same character looks different at 6 and 13, 17 and 24, and 62 and 80 - but is still identifiable as the same person. Faces become gaunt after the hair grays, and those who are good friends with the alewives pack on pounds. Being widowed and remarrying a girl that's only just reached her majority makes you scrunch your nose - because the game manages to convince you that pixel collection A is a fat old man, and pixel collection B is only a child.
I always picture it as your waifu tagging along to keep you company during wars.
Well, if we go by records, keeping girls as spoils was a thing in the middle ages. A dutiful wife might not want her hubby doing that. Think AGOT had a mechanic like that, but it was some event during a war where you visited a brothel or something.
It was rare but not unheard of for wives to join their husbands during medieval campaigns - Éléonore d'Aquitaine is perhaps the most famous example. There are certainly cases where it would make sense, both mechanically and thematically, for you to be able to bring along your wife or even your entire family. Perhaps you know that your keep will fall, and so you bring your family on the campaign trail instead of having them become hostages. Perhaps you've pledged yourself to the Crusade, and your zealous wife insists on accompanying you to the Holy Land. I would welcome the option, but as it stands, we have Schrödinger's Wife: She is available for events and consumation even if you're leading an army on another continent, while simultaneously managing your household immaculately in the capital, where she can also be taken prisoner.