Costume Quest is one of those games that gives a good first impression. It has a nicely defined, clean art style, reminiscient of Animal Crossing or Earthbound, a whimsical sense of humour and simple game mechanics.
The main thrusts of the game are mild adventure style item hunts and RPG battling. In order to proceed further and rescue your sibling from the clutches of the monsters hell-bent on stealing candy from your town, you need to acquire new costumes. Many of them have abilities that can help you proceed, whether it's an actual skill that affects the environment or simply a character that wants to see you clad in a particular getup (fetishists, probably).
Battles take place in an alternate area, in typical JRPG fashion. Once there, however, your characters transform into what they imagine their costumes to be. It's arguably the game's greatest strength, as finding the components to a new costume and then entering a battle to see what sort of real-world creature it turns into never gets old.
The battles are all turn-based, and you can attack or use special abilities (all of which take three turns to charge). There are timed button presses on each attack for increasing damage, and for negating some of the damage taken from enemies when it's their turn. Special abilities range from healing and defense to stuns and area of effect attacks. Unfortunately, many of them are repeated from costume to costume, making some costumes unique only in physical appearance and not abilities.
None of this is particularly difficult, however. The item hunts simply require you to carefully wander around each of the three main environments, cards are earned by defeating enemies, candy is earned by whacking objects and trick or treating (many battles are engaged this way as well), and battle stamps are purchased from a creepy Peanuts' Lucy lookalike.
By the end of this roughly five hour experience, you'll have experienced pretty much everything it has to offer, and unfortunately, the game provides absolutely no incentive to replay it as every collectable and every achievement can be (easily) earned the first time through. The story is amusing but other than one or two moments it's never laugh out loud funny (props to a fantastic Arrested Development reference, though), and the battles are essentially the same thing over and over again until you hit the final boss. There are probably too many battles for the game's own good, as it's the adventuring stuff that's a bit more compelling. But even there it's very light fare and not particularly substantial.
It comes as a bit of a constrast to Double Fine's previous games, which featured fantastic characters and story but middling gameplay; Costume Quest lacks most of the former and unfortunately inherits most of the latter. But it's charming enough you won't really notice until after you've finished.