Outcast was a breath of fresh air for me at the time, I still regularly revisit it. Appeal was a very approachable company as well, one of the team even sent me a new updated install disk as the DX8 (7?) problem wouldn't let me install it in WinME.
I was really looking forward to Outcast2, I had faith that they could pull off something special, sad news indeed. It sounds like an almost Thief3/ Looking Glass kind of story though, hope Elsewhere take up the challenge of spiritual successor.