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Some love him for his fiery, rapacious ambition – and the sheer scale of his aspirations. Some denounce him for the exact same reasons.

But most with any interest in video games will agree that this would be a far more tedious industry without Peter Molyneux.

Not to mention a stationary one; creator of Populous, Black & White and Fable, he’s propelled software design forward – and influenced more great games than many of us have played in our lifetimes. And he shows no signs of stopping.

Despite his well-documented keenness to stretch beyond the realms of possibility – and aching inability to admit defeat in doing so – he is still very much a legend, and one with an immense talent.

Molyneux pledges that his latest opus, Fable III, really is a step change – both for the series itself and the RPG genre.

A new ‘Touch’ mechanic (deftly lifted from ICO) is front and centre, but other surprising flecks – the lack of a power bar, the outright removal of Fable II’s experience and expression systems – make Fable III one of the year’s most intriguing prospects.

We caught up with the man himself to ask him all about the title – and a little game called Milo & Kate…

Why make such bold changes to the setup of Fable II – which was a very successful title critically?
We could make just another Fable with combat, with a very similar story – we could literally replicate what we did in Fable II. But I think we like some of the surprises we offered in Fable II – and would like people to be surprised again.

We’ve concentrated our changes in three big areas. The first area is story – I think stories [in modern games] are a little bit formulaic. The second one is to do with what you think Fable is – is it an RPG game or an action adventure game? Looking at things like experience and health bars, should they stay there?

The last thing is to give people new mechanics and new things that they’ve never seen before in games to play around with.

What exactly has changed with the story?
Most computer game stories – including Fable and Fable II – are the same. They start off with you very powerless.

Over the course of the game you build up your power, then there’s some terrible bad guy – in Fable I he was called Jack of Blades, in Fable II he was called Lucian and Fable III the bad guy is called Logan. You build up your power and you have some big final battle… you usually kill the bad guy, end of game.

Well this time in Fable III the bad guy is the King of Albion. He rules Albion, and the way he’s ruling is awful. There are dungeons full of prisoners there are people starving in the streets, he’s tearing down beautiful forests of Albion and replacing them with industry – he’s a real tyrant and your job as a hero is to build up support so you can have a revolution.

In that revolution you can overthrow that evil tyrant. We thought: Why don’t we make that the halfway point in the game? If halfway through this game you defeat the bad guy, and the rest of the game lets you rule Albion?

Why not allow you to decide what’s right and wrong for the whole of the kingdom? Why don’t you decide where you spend the money in the treasury? And that is pretty unique, I don’t think I’ve seen or played that in many games before.

You mention the debate over whether Fable III is an RPG…
Now, RPGs have experience. In Fable III we don’t have experience anymore – we have this new thing called followers. The idea is whatever you do in the world either gains you followers or loses you followers. If you complete quests that is a great way to gain followers.

The same is true if you give out promises, if you say you’ll do things when you’re king – or you can grind in the world and literally, individually you can gain or lose followers.

Just like in Fable II you can buy anything you like, but it’s a lot more significant this time. If you buy the main house in this town and move your family in you will gain more followers because you will gain the respect of your community.

Over the course of time flags will change into your flags as communities follow you. Followers make a much better mechanic [than traditional experience].

Then there’s Touch – which I’ve talked quite a lot about before. I can reach out any time I like and take anybody by the hand, maybe we’ll go for a drink together, you can choose to do that with women, with whoever you like.

Does the Touch mechanic lend itself to every character, even those who are direct foes?
Yes, you can use it on co-op players as well. Co-op is now fully functional in the game, you can invite anybody you like into your world, they can go off and do their own thing. They aren’t linked to you anymore.

So if you came into my world I could say look we need some gold, you could go off and become a blacksmith for a while and I’ll go off and be a pie-maker for a while – you go off and do this quest I’ll go off and do that quest. You can marry your co-op person and have children together as well, or you can form a business partnership if you don’t want to marry.

Are there any more changes you haven’t talked about previously?
The biggest single change on the controller we’ve made is with the start button, traditionally it brings up a pause menu, a list of things in the world. This time if you press the start button we instantly go to somewhere called The Sanctuary, which you can walk around. This is a functional replacement of that list. It has everything – each room is something you’ve found in the game all visually done.

We’ve got John Cleese to guide you through your rooms and make selections as your butler; he has recorded hundreds and thousands of lines.

What about the weapons – what’s changed there?
Each of the weapons in Fable III will level up, just like you level up. As you use them they start visually changing and unlocking different skills. You can switch weapons between guns and swords really quickly; you can really craft your own combat.

We wanted people to feel their sword is unique, every time you swing the sword it changes it a little but also who you as the creator are starts the seed of what that sword is going to become.

So we take your Gamerscore and some of your achievements to actually change the sword as you use it and then you are free to sell that sword or not, it is branded with your Gamertag and is known as ‘your sword’, no one can change that because you’re the creator. If I take it on it will still be known as your sword but I can change it from a good sword to an evil sword.

Between Fable II and Fable III have there been any games that have influenced the way you thought about things?
ICO is the feeling of touch, obviously. I think things like Grand Theft Auto, the way they use shops rather than doing lists is great – and we’ve used some of that, especially in The Sanctuary area. I just feel the way that entertainment is going is trying to give us less and less complexity or ‘fiddly-ness’ and more accessibility.

You talk about losing ‘fiddly-ness’ in entertainment, which is obviously a major theme of Kinect. Is it too early to talk about connectivity with Fable III?
Well the only thing I can say is yes we are fascinated with Kinect, yes we are fascinated with connect and Fable III – we’re just not showing anything yet.

I will tell you I don’t want it to be some crass mini-game where you jump around and kick chickens. I want it to be a meaningful part of the Fable world, but the balance of that is to make sure that you never want people to have to have Kinect to play it. I love the technology, I think it’s really cool, I think sitting back and playing with your controller and then accessing Kinect as you do that just gives you cool stuff.

We didn’t get to see Milo at E3 this year. Does it still exist?
Yes it sill exists, absolutely. In fact people are seeing it as we speak now; we’re just not showing it to the press. There’s a very interesting reason but I can’t tell you why.

I promise you it is ten times more amazing than you would expect it to be. What I showed in Milo was just a tech demo, I think everyone asked: ‘Well that was pretty fascinating but what does it mean? It’s only when you actually see it in its entirety and actually play it…

Returning to Fable and Kinect, you said you’re still messing around with ideas…
Not so much ideas…it’s very hard to answer that directly. The only thing I’d say is if you look at that presentation of Kinect at E3 and thought could Fable fit into that presentation, I’m not sure quite it does. I think it suffers from being a mature game so how does that fit into [Microsoft's family-orientated Kinect presentation]?

Don’t think of it as what it is and what it is not. We have Kinect and we have Fable, and we’ll bring the two together.

Are you done with development on Fable III?
This is going to be released on PC and 360, they’re going to be very close, 360 first though, a matter of days afterwards will be the PC version.

We are on the 26th of October, so the phase we’re in now, there are about 35,000 bugs to do, but yeah that’s where we stand, no features to add, just bugs.

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