It all came down to budget. It's quite interesting how that changes over time in the show -- for example, Season 1 is really underlit in places, so then they got better lighting in Season 2. Season 1 barely had fight scenes, then they got the money for it in Season 2. They shot on 16mm for the first two seasons, then got the budget to shoot with 35mm, which makes the show look much, much better. They never got enough money that the CGI didn't look bad, but that's just something I have to forgive for a 10 year old show.
Also, just having a budget doesn't mean that there can't be real problems with the fight scenes anyway. Much as I like the swordfight in Becoming Part 2, they shot the stunt doubles very badly, which comes down to camera placement and other things not as reliant on a budget (seriously, that's where you go for a wide shot from above, not a medium shot from the side. Unless Buffy was supposed to grow 6 inches and Angel's hair was supposed to start receding in the middle of the fight).