Game Breaker: The Beam Reflexor upgrade for the Blaster. The shots bounce off walls and home in on enemies and it can be fired fairly frequently, allowing it to easily clear even very large rooms in under a minute. It's also one of the very first upgrades you get in the game.
Harsher in Hindsight: One of the adverts for the game parodied Luke, I Am Your Father, with Daxter attempting to convince Jak he was his father and the announcer assuring the audience that the game wouldn't "end like this". He's right. In the game proper, Jak does meet his father, but it ends tragically, with Damas dying before he would ever know that Jak was his son.
Moral Event Horizon: When exactly Count Veger crossed it is up for debate, but it's widely accepted that he crossed it. Many point to his gloating to Jak immediately after Damas' death as one.
Light Jak's regeneration invokes this with a high-pitched crystaline humming noise as your health fills back up.
Narm: The battles between the Freedom League and the Metal Heads/KG bots become hard to take seriously, especially after the War Factory is destroyed. The entire city sans the port consists of endlessly respawning soldiers and enemies killing each other over and over. You can't even help effectively because the FL troops are just Palette Swaps of the original guards, so your weapons will automatically target them too.
Scrappy Level: The Nintendo HardPac-Man esque minigame in the power station. It becomes a lot easier though once you realize that you can speed up Daxter's movement.
Shocking Swerve: There are quite a few in this game such as the Precursors actually being ottsels like Daxter with highly advanced technology or Jak possibly being The Mar.
Strangled by the Red String: This game has Jak and Ashelin become a couple, despite the previous entries of the series has Keira and Torn as Jak's and Ashelin's respective love interestsnote though the previous game did have a few cutscenes where Ashelin shows signs of feelings towards Jak. Jak X and The Lost Frontier would ignore this and restore Jak and Keira's relationship.
Underused Game Mechanic: One new feature that many fans felt was disappointing was the implementation of Jak's new Dark Eco ability of Invisibility. Aside from an once-visited volcano level, it could only be used at the Monk's Precursor Temple monastery, thus meaning any use of it this for any stealth based tactics (or for that matter any sort of stealth-based missions) outside that location is denied to players. Granted while there is an unlockable ability to turn invisible by pressing the triangle button in Dark Jak form, but that only becomes available after completing the game (though it is somewhat subverted if someone buys it from the Secrets menu and then starts a New Game on Hero Mode).
Win Back the Crowd: For those who were unhappy with the drastic Genre Shift Naughty Dog made between Jak 1 and 2, Jak 3 offered more of a happy medium between the two.