That's what was funny about the Star Wars prequels: The newer Yoda puppet was horrible; but, they did CGI and he looked more like Yoda should. However, a lot of other things weren't good enough and were just weird looking. I now look at it, though, as humans in a cartoon world and that helps me accept it better.
Muppets in CGI: For effects, good. As a crowd shot, walking down the street together as seen from afar then that would be a good effect. Performance--Where's W.A.L.D.O.? He's the only one I can accept that way.