It wasn't THAT bad, I'll be the first to admit I preferred its predecessor but it's still great fun to play.
The point that you're trying to make is confusing me, one minute you're implying it's Vergil's spirit in Mundus' armour, next it's Mundus' power in Vergil's body. Could you please make your mind up? Everyone who played 3 all the way through knows that Vergil was weakened by his battle with Dante. By rights, the slash that Dante delivered would have cut several cows in half. Vergil was weakened and in that state he was unable to stop Mundus diminishing his free will and either erasing or distorting his memories until he became Nelo. No one's disputing that but the fact of the matter is Nelo is Vergil, with all the aggression and all necessary skills including his ability to teleport at will. He is, however bereft of any knowledge of his past as far as I can see and, even when flashbacks seem to occur to Nelo, they aren't there for very long.