Part of the uneven quality of the sequels may have been due to the fact that they came from two separate production entities within Disney -- the TV Animation group and DisneyToon Studios -- with the two outfits often working on the same characters to different ends. The first-run success of Lilo & Stitch in 2002 led to the DTV Stitch! The Movie, produced by the TV division as an introduction to the 2003 series. Two years later DisneyToons' Lilo & Stitch 2: Stitch Has a Glitch featured a story set in the interval between the original film and the first DTV. The Stitch saga came to an end last year with Leroy and Stitch, again produced by the TV division as the closing chapter to the TV series.

Fox and the Hound 2, which offered a major change in tone from the original's realistic and even downbeat underpinnings, wound up offending the purists.

Likewise, Tarzan and Jane actually preceded Tarzan II onto the home video shelves by three years; it consisted of three episodes of the spun-off TV series connected via new linking footage. Even if they can't put their finger on it, audiences can still feel the difference between stories and animation made for TV, and higher-budgeted DTV features that attempt to recreate the look and feel of the original movie. "That stuff really hurts you," complains Kammerud, who directed Tarzan II, "it's just dumb."

According to Morrill, the two divisions worked closely together, but are now going their separate ways. "We shared a lot of resources for very long time -- space, technology and operations. There was never any rivalry. Creatively and production-wise we were separate, but always very friendly." And what will take the place of the DTV sequels? "We want to do more franchise-driven movies," says Morrill. "We've been moving in this direction for the last two years. We're trying to find an arena where we can tell many, many stories -- not sequels. We want to find a world and then explore many stories within that world."

The first world up for exploration is a newly discovered valley in the heart of Peter Pan's Never Land - a place called Pixie Hollow. The hollow is home to the "Disney Fairies," a major new initiative from the company. A series of DTV releases -- the first starring Tinker Bell and due out later this year -- will drive a product line of books, toys, clothing and collectibles. "Tink" will find her voice and a passel of fairy friends, each of whom will be spotlighted in subsequent videos.

The Fairies will be CGI-animated by Prana Studios in India. Prana is already at work on Unstable Fables, a series of DTV feature-length fairy tale spoofs for the Jim Henson and Weinstein companies. The same purists who were offended by Disney's DTV sequels will now have a new target for their ire: a talking, three-dimensional Tinker Bell. ("I've had to have a very thick skin all these years," Morrill sighs.)

A major new initiative, "Disney Fairies" from DisneyToon Studios will introduce a CGI Tinker Bell. She will star in a series of DTVs and drive a product line of books, toys, clothing and collectibles.

At first glance, the Disney Fairies appear to be aimed at the demographic too old for Dora the Explorer and not quite ready for Bratz, but their real target is probably the venerable Barbie and her line of Fairytopia DVDs, toys and games. Lasseter's arrival also impacted Tink and friends, according to Nissen who's now part of the project. "We had a big story change shortly after Lasseter came on board. They still want it to get on time related to all the other company-wide department, publishing, etc. There's a bunch of us here just cranking to get the movie up and running again."

Morrill promises that other franchise-launching DTV features are in the works. Will any be produced in traditional 2D? "The creative will dictate whether it's CGI or 2D. We needed to get these Fairies movies up and running; now we can focus on our development, so they're still in their early stages."

The end of the 2D feature sequels (and the drop-off in 2D production in general) played no small part in the closing of Disney's satellite studios in Orlando, Paris, Japan and lastly Australia. There's genuine regret in Morrill and Nissen's voices when they discuss the studio's shuttering even as Cinderella III was making its way through the production pipeline.

"The movie is a testament to the Australian animators," Morrill says with pride. "This was going to be their last movie. From the very beginning, they said, 'We're going to make this the best movie we've ever made.' A lot of times when you're shutting a studio down, that's not the case. It was their swan song." She pauses for a second, then continues. "They really stepped up and gave it their all. It's a testament to who they are as people and as artists that they did that." Nissen goes into greater detail about the studio's final effort. "They did an amazing job. I can't thank them enough or sing their praises highly enough for how diligent, caring they were. They stuck with it, even though they were letting departments go as production progressed -- when the layouts were done the layout people went, when the key animation was done the animator left. The studio was kind of closing around this team that just kept getting smaller and smaller as they finished the movie. They stayed with it and kept it beautiful and kept their conscientiousness all the way thru to the end."