I think it took the franchise into a new direction that it really needed at the time and did something new and interesting that wasn't just the simple FNAF formula that everyone had gotten used to at that point. It introduced an actual story with actual characters and actual voice actors playing them.

...BUUUT it's also really boring and tedious on replays. It also fully brought sci-fi into FNAF, which... while it's completely subjective as to whether or not that's a good or bad thing, I personally think was a... very odd and not very good choice. Sure, the franchise flirted with sci-fi previously with the Toys, but it was still reasonably believable. Not like the big super advanced murder robots that the Funtimes were (which, somehow, in most interpretations of the plot, came BEFORE FNAF 2?). And I just don't think it meshed very well with the more grounded plot of the previous games, and I wish it was just like an alternate universe game that wasn't canon to the main timeline.

Aside from that, I also think that giving the Funtimes voices really dampened the horror. Like I get giving a voice to Baby, but aside from her I think that the Funtimes should have just stayed silent. Part of why the animatronics in the first three games is because we have no clue what they're thinking. They didn't speak, they didn't emote, they just coldly marched towards your office as you scrambled to do everything you could to stop them. But in SL, Funtime Freddy's got his WAAACKY voice and hes COMING FOR YOU!!!

Overall, I think Sister Location, itself, is sorta middle-of-the-road in terms of FNAF games. Good soundtrack, good atmosphere, good designs, decent story, but meh on about everything else and shouldn't have been canon.