I don't think Yu and Sega are really in bad terms - the whole S3 is peppered with Sega stuff - like Sega Saturn minatures, Sega logos all over, (QTE3 and other stuff), Sega posters (VF3, Space Harrier etc).
If the fighting system's change was due to Sega's copyright issue.. I just hope they can work it out somehow. Without grabbing/throws - things are quite a bit a mess... although I am finally getting used to doing some combos. Low sweeps to unblanace your opponent and flurry of strikes cancelled into finishing blow (elbow strike) - followed by couple of low sweeps to take off additional damage is my current method. It's getting pretty enjoyable, but I still miss tactile feeling of the S1 and 2 fighting system. Camera, though - is much more locked in this time around - so it's good and bad at the same time. More stable camera could have been more useful in S1 and 2 fighting - but you also lose some cinematic angles...
Anyhow, currently running through Niaowu - enjoying every minute of it. Every time I see Shenhua, I feel bad for her though... that she left her home following Ryo (me) to find her dad - but I am taking my sweet time - of getting all the capsule toys and lucky hits. LOL.... and end up at the hotel, reporting to her "nothing new to report".
Hope S4 would come soon. It's apparent the game of this scope, really needs proper funding and dev crew. 75 people just won't cut it.