Yeah the Goblin costume didn't really work. But to be fair it's hard to think of one that WOULD.
He's just a very silly looking character.
I can't argue that.
For me SM3 stumbled because of trying to cram too much into it. I thought the Sandman was a poor villain---he's just a petty street crook with no grand agenda. He certainly had no idea of offing Spidey until Venom came along and then in the end he was prepared to just walk away rather than try finishing Spidey off. Sandman's heart just wasn't in it.
Osborn's performance enhancing stuff did pretty much the same thing as the black goo: exacerbate one's darker tendencies and inhibit normal inhibitions in addition to enhancing physical ability. The question remains: what would Harry have gone on to do beyond just trying to revenge his father's death? Could he have been a complete villain or was he really just obsessed with killing Peter? This should have been the main story IMO and Harry could have been the one to try to corrupt Sandman if needed.
To me Venom was extraneous, and apparently Raimi thought so too. Including him (at the suits' insistence) fucked everything up. Venom could easily have been done later. At best we could have had a foreshadowing by having the goo merge with Eddie Brock at the end of the film.