My only gripe with the nemesis system was that I didn't want to kill my nemesis. I always felt over powered and never had a chance to naturally develop conflict with the enemies, they died too easily unless I purposefully let them live.
It would be a wonderful system to see put to use in a different setting, spies, organised crime (mafia, yakuza etc) or even the underground racing style games like most wanted could put it to an interesting use. In Mordor it just felt under utilised.
A different setting, like perhaps Batman?