Ah, the first Inuyasha movie...I went back and watched it to write a review on it, and it hadn't lost much of any of the things I loved about it the first time around. All in all, it's my favorite of the four movies despite one section I really dislike.
Plot
The movie takes place sometime after episode 54, as Inuyasha has the Bakuryuha (Backlash Wave), and Rin is traveling with Sesshoumaru.
When the Shikon Jewel was shattered, it woke up the powerful demon Menomaru, who is the son of a powerful youkai (Hyouga) defeated by Inuyasha's father 200 years ago.
Now, Menomaru seeks revenge for his father's death, as well as to become all powerful.
Basically, your "big bad youkai who wants to get even stronger" plot.
Characters
Nothing much new, here. The protagonists are nicely in character, and each of them gets their own time to shine in the movie which is something I rather enjoyed.
There are three antagonists; Menomaru and his two minions (who fight against Sango and Miroku).
Kikyo also appears in the movie, though she doesn't do much except to scold Kagome after one event and send Kagome back to her time.
Sesshoumaru is also in the movie, but does absolutely nothing (sorry Sesshoumaru fans, but there was no reason for him to be in the movie).
Overall
I'm trying to stay objective, as this is my favorite of the four movies. The recent watching, I stayed on the lookout for any nuances I could pick at, and didn't come up with much.
The pace of the movie moved appropriately, and there were enough action and emotinal scenes (as well as an even balance of them) to bring the movie and the characters to life.
What I did find, I'll have to warn of slight SPOILERS.
The non-spoiler is Sesshoumaru. As I mentioned in the characters section, he appears in the movie but does absolutely nothing except kill a couple tiny months and talk with Kikyo. Seeing as how it was the father of Sesshoumaru and Inuyasha who killed Menomaru's father, one would think that Inuyasha wouldn't be the only target of Menomaru's revenge.
Had that been in the movie, and had Sesshoumaru been forced to actually fight, his appearance might have been justified. However, since Menomaru didn't even mention Sesshoumaru, there was no need for him to be in the movie.
Again, apologies to huge Sesshoumaru fans. Granted, I'm sure those fans felt let down that he didn't do anything even though he got a cameo in the movie.
The other nitpick of the movie is the use of a plot device I absolutely hate: Mind control.
In this case, it was using Kagome to fight Inuyasha in a nearly identical way of how he and Kikyo clashed 50 years ago.
Besides the fact that I hate the use of that plot device, it seemed rather convenient that Kagome managed to break out of the mind control/spell after she had badly wounded Inuyasha with an arrow...
...as if sticking claws through his gut and sending out shards of energy wasn't injuring him enough?
Which brings me to another nitpick about that scene...where did she get the ability to send shards of energy flying, and have them act as extending claws? When Kagome was possessed by the Dark Miko in the series, she wasn't able to use any ability she didn't naturally have; why should this have been any different?
I suppose one could argue that the stone which controlled her allowed her those powers, but it's a rather weak argument.
Also, Kikyo shows up immediately after Kagome breaks out of the mind control, which means that she was in the area but didn't interfere even though she probably could have broken the spell with her powers.
Now, one could argue that, at this point in time, she still hated everything and that's why she didn't try to save Inuyasha, but then why did she get so angry at Kagome for injuring him? There's a clash there.
Still, those things are minor inconsistencies which doesn't really make themselves apparent to the audience unless one is either looking for it or gives it a lot of thought.
I couldn't find much else wrong with the movie, and I'm not just saying that because it's my favorite one. I loved how Kagome and Inuyasha worked together at the climax of the story, and the battles the others had as well.
The animation was excellent, and the ending song was very pretty to listen to. While not the most original story-wise, the rest of the movie with its fights and emotional scenes made up for it.
I did dock some points off of characters for generic bad guys, Kikyo's odd role, and Sesshoumaru's needless appearance, but otherwise, everything was in order.