Yeah, that was an annoying mechanic. It wouldn't have been so bad if the load times weren't soooo sloooooow. I found it annoying in general that even though you would find better equipment / spells, they all had some stupid negative aspect to where I didn't want to use them. For example, the flame sword was great, but you can't drink blood from your victims. I mean, it makes sense logically, but come on...I also disliked only having 5 spells / items equipped at a time. There were several that were very situational (like the antidote one) and I'd have to equip it, unequip it over and over.

As for the sequel, I'm thinking we can bounty up their entire Kain series. Soul Reaver would be next!

So is Blood Omen 2 or Soul Reaver next after the original Blood Omen?

In terms of actual release date, Soul Reaver is next.