This film would have been above-average without Loy. With her, it may very well be the best musical of all time. I never cared for her politics off-screen but, on-screen, Loy was gorgeous from day one. In this early work, she is very young and simply carries the film to greatness.
Remember When Movies Didn't Have To Be Politically Correct?
I liked her very much too - yes, she's gorgeous! (I remember hearing that Jeanette McDonald was quite aware of the possibility of being eclipsed by Loy's beauty - and at one point, as the star, insisted on wearing a nightgown that Loy had been slated to wear - didn't help much because Loy then chose an equally beautiful one!).
I like the interaction between her and her character's uncle, C. Aubrey Smith. She's kind of flirtatious and seductive with ANYONE - and this solid old fellow will have none of it! :) (I actually liked their characters so much - that it woulde have been fun to hear that they were NOT really uncle and niece - but unrelated. (Charles Butterworth could find this out when he is doing his research into Chevalier's title!). And then they fall in love - pretty shocking in itself given the age difference - but so much in the film is turned completely upside down (including the absolutely wonderful gender switch in the chase scene toward the end) that I think Smith and Loy falling for each other once they learned they weren't related - would actually fit with the wildness of the film!
However, even without Loy, I'd have thought it my favorite musical. It's just superb in so many ways.