Hot take here, but I genuinely didn't mind the D-pad controls. The addition of a run button made it perfectly playable to me.
I think literally the only thing that was a little hard for me to pull off is running in a tight circle around those eyeball enemies, but even that I could do with a tiny bit of practice.
My only complaints with the game is that none of the new levels are as big and fleshed out as the original levels (but I'm still glad they're there), and the fact that Mario is the only character who's fast in the game. Playing Mario 64 with characters that are even slightly slower than Mario just feels weird. But thankfully you only NEED the other characters for a handful of stars, so 90% of the time I can still play as Mario.
If you want a 3D platformer with truly horrendous D-pad controls, play Rayman 2 on the DS. No run button from what I remember, and there was a slightly lag after pressing a direction, so it felt like ABSOLUTE shit.