2. In 3e the campaign doesn't necessarily move away from favoured enemies as viable foes as level increases. Take Dragons, Demons or Undead (if DM allowed damage bonus against them - many did) for example - they all have foes available across the entire CR spectrum. You've got to work pretty hard to pick a favoured enemy which really is limited. Nor does it force the DM in any way - unless the DM plans a game with no dragons, or no demons, in which case it is simple for him to tell a player not to pick that foe because it will never exist. The PC doesn't fight them all the time, but occasionally they come up and on those occasions he gets a decent bonus.
Personally I *really* liked the 3.5e rangers favoured enemy - it grew organically with the character, and so as a campaign progressed he could stay with older enemies or focus on newer ones that looked like they were going to be around for a while.
It has been a while since I played 3.x, but this is not how I remember it going. Sure you could have things like Dragons and Demons as opponents at lower levels (and some famous WOTC adventures had a small dragon in lower level adventures), but for the most part they tended to come into play at the higher levels, and many people choose orcs or goblins and the like when starting out to get an immediate bonus that faded in usefulness as you went up in levels. Of course, you could have these as opponents at higher level through a leveled up NPC's, but such was somewhat time consuming for the DM to put together, though it did happen every once in a while. So your highest favoured enemy bonus ended up being against a class of monster that you largely out grew, and you ended up with the lowest bonus against your newer selection that you happened to be facing more often now.
Also, IIRC, the Ranger seemed to be one of the classes that many people where dissatisfied with in 3.x. Everyone, and I mean everyone and their dog, was coming up with their own particular alternate Ranger variant (Hunter, bush fighter, etc.) I know 3.5 tried to fix this issue with alterations to the Ranger class, but it seems many people where still not happy with it. Though, to be fair, many were unsatisfied with other aspects of the 3.x Ranger design, like the spell casting.