It was new technology, 3D was a fairly new concept in gaming in the mid 90s. But it took so long to get properly implemented. You have super mario 64, gex enter the gecko, lemmings 3D. I am wondering if it was a business decision and not the devs who pushed for a free roaming camera, since it was clearly not a satisfactory result gameplay wise. Because at the same era, you have games with fixed camera angles that are much better experiences overall.
One weird thing in Alundra 2, is that if you turn the camera while moving in certain direction, you continue moving in that (map) direction even if, from the new angle, you are pushing the D-Pad in the opposite direction. You have to release the D-Pad and press again to go in the new correct direction