He's wanted to diminish the CGI as much as possible and put a man in a suit with CGI changes. He was afraid of the whole thing looking like a cartoon; I suspect he's trying to make the character look as real as possible.
There has never been a successful follow-up to the original 'Kong'; the 1970s remake tanked. The original film became such an unexpected success that there has never been anything substantial to add to it, and no possible way to compete with what was already achieved.