Yes you quickly overlook the puppet aspect and come to admire the characters for being far more visually interesting and multi-faceted than soooo many bumpy-headed aliens. The show also has more female characters than most of its contemporaries so it scores points there too. They also throw quite a few curveballs at you throughout the shows run too.
My main criticism is the amount of unnecessary shouting Ben Browder does. If I was Dargo I'd have shot him during season one.
They have a fairly decent cast but maybe a few more recurring characters would have given them some more cannon-fodder like in NuBSG.
Overall though it was a hugely enjoyable ride.