I'm not sure it's to do with more capable software or hardware. Instead it was far more about economic incentives. When Molyneux was earlier in his career he had strong constraints from his bosses and from his publishers. This forced the compromises needed to actually deliver achievable visions. As his reputation grew and he had more and more power in those relationships he was less and less constrained to adhere to an achievable vision. By the time of Black and White core parts of the game were just unbalanced and the economics of the game were broken because it was busy with the creature gimick. By the time you got to 22 cans he owned the company, he didn't need a publisher, hell he could just kickstarter the games. So suddenly all bets were off, he could make any promise he wanted and there was no one around to actually force him to deliver something.

I don't think Molyneux would've created Populous if he had had the reputation he has today. He would, and did, create Godus instead.