The Ending Needs Fixing and Here is How...
The biggest problem with this movie (aside from too many anti-climatic jokes) is the ending. I still like this movie and it is good, but for a finale to the series (they aren't certain if they are going to make 3 more) it wasn't quite strong enough.
Why doesn't the ending work?
Well, for a couple of reasons... and it mostly deals with Kai.
Kai is a cool and interesting villain. What makes him even cooler is that he was once friends with Master Oogway. Now there is a lot you can do with this, but nothing is really done with it. For example, what is Kai's motivation?
Can anyone figure out why Kai, the person who risked everything to save his best friend Oogway, would suddenly turn on the people who just saved his best friend? Does that make sense? No, it doesn't. The plot essentially makes Kai evil with no reasoning other than "power" and even then they never say he did it for power. This is a big problem with the film; however, there could be an easy solution.
Remember, Oogway and Kai were fighting a war at the time. What if Kai learned how to absorb people's chi in the war? The pandas taught him after healing Oogway, and then Kai swore revenge on the people who harmed Oogway why stealing all of their chi. Then this is where Kai's soul becomes plagued because he has the chi of an entire evil army inside of him.
THAT MAKES SENSE!
And you know what would make it better? He doesn't get "poofed" by Po. Remember in the beginning of the movie when Shifu tells Po "Being the dragon warrior is more than using your fists and fighting". What if Po defeated Kai by using the "given chi" to uncorrupt him? Or what if Po had to beat Kai in a way that didn't involve fists? As far as storytelling goes, Kai getting destroyed by having "too much power" makes no sense. Kai was already going to absorb everyone so why would gaining the energy from them hurt him?
KAI REPRESENTS UNLIMITED POWER! HE NEEDED TO HAVE BEEN DEFEATED BY SOMETHING THAT ISN'T POWER.
How much better would it have been for the movie to have ended with Kai and Oogway in the spirit realm as friends again? How much more satisfying would that have been for a conclusion to the series? Po actually saves a villain. He doesn't let the villain die, or poof the villain, but his final villain is converted; thus showing that Po has grown beyond his old ways.
And yes, I still like the movie, but there were some major missed opportunities here. Heck, technically the ancient pandas never died since they were all absorbed. You could even do something with that in the plot. Maybe Po could've learned chi from the ancient pandas? There are just a lot of more interesting things that could've been done.