Why couldn't Michael focus on going legit during this time and why did it take 20 years to pursue his awkward goal of purchasing a piece of the Vatican's holdings?
I get the whole redemption and guilt over killing Fredo as his driving force to seek rebirth via his relationship with the Pope, but again, what happened back home that prevented him from pursuing legitimacy during the 60s and 70s?
I always assumed there came a point in this middle-aged man's life when he realized he had more obligations to criminal enterprises than to his real family, that he needs a sister he widowed for PR within that family, and that his kids keep him at a distance. There are only hints about any of this of course.
Or it could have been fall-out from the hits at the end of Part II as with Part I, and that it took some time to solidify / iron-out blood debts / curb the drug trade / deal with Nevada. Then there's the Cuban Missile Crisis which lost money for all the families, so it would take a number of years of illegitimate business to recoup the losses from that. He probably took some time adjusting to the divorce and since he wouldn't see his kids all that much, it took a while to sink in that maybe legitimate business was a better future for them. But again, this isn't verified anywhere, either.
Pacino having aged so much between parts II and III doesn't help implying there was more time elapsed than there was supposed to be.
They should have set the story during the time Michael decided to change, not afterwards. It feels like we missed a portion of the story when the film starts.
They didn't even need to make Michael a sickly old man as Pacino wasn't that old back in 1989-1990 when this film was made.
^^^This. It's a very good suggestion. Part of the problem is because we the audience did not witness Michael's transition from TGF2 to TGF3, hence the feeling we missed out on something.