Honestly? I dont think this game is worth much hype its been given. Yes, your character can grow, and yes, the actions you take can (technically) alter your characters appearence, however the adjustments I saw (for being evil, you get silvery lines over your body, and I didn't see anything change for being good) really could have been done much better.
I haven't played Fable 1, and as such might be missing out on some key features for me to understand and enjoy the game, but as it stands, I found the game to be really slow, and dull. While you can accessorise your character with different clothes and / or weapons, the clothes don't seem to have any differences besides appearence (for example, a monks robe, in most games, wouldn't have as much protection as armor, but in this game it does). I've watched other video reviews of people who enjoy the game, but can't see their enthusiasm, I've tried to play it many times, but have never been able to be anything more than somewhat bored.
You get relationships by doing a series of actions next to a woman (or man) - the woman usually has a helpful bubble close to her, telling you what action she (or he) likes - doing that action over and over and over again increases her liking you, and eventually you can go off and get married (I assume, I never even attempted the relationship side, bar from being set a quest). You can buy a house from doing the side-jobs avalible (which is usually pressing a button when a moving indicaator gets to a certain point on a scale), you can then rent this house to get money, to buy clothes (or weapons); much of which seems irrelivant, as I could kill everything with one of the cheapest guns avalible).
Several friends have told me that this game is about the co-op mode more than single-player, yet watching my brother play with his friend, it seemed to be much of the same thing, just with another avatar running about. If I had known what I was buying when I bought this product, I would have put it back down and saved my money, and is one of the worst choices I have made for the 360.