One thing to keep in mind, too, is that Katzenberg wanted to do darker, edgier stuff, which is one of the main reasons why he left Pixar and went on to form DreamWorks with Spielberg, and that other guy. Remember his vision of TOY STORY? Where Woody was a straight-up, sadistic @$$hole, and all the toys treated each other like crap?
What's interesting though is that it seems like each DW movie actually got tamer and more kid-friendly than the previous one. The first SHREK had language, adult jokes, and a lot of crude humor; SHARKTALE was essnetially a CGI spoof of those GODFATHER movies with sea creatures; then gradually each ensuing DW movie seemed to tone this down.
I still say that their live-action outing, MOUSEHUNT, is an underrated masterpiece.