There was only one direction they could've gone for a sequel that would've kept proper continuity for the franchise and would've made sense, and that was to do a 180 on the overriding theme of the original movies of rebels trying to bring down a corrupt government and making it instead about the heroes establishing the New Republic as a struggling young government and fighting to keep it together rather than tear it apart. They could've portrayed the New Republic as a fragile alliance between reluctant member worlds, skeptical of joining yet a new intergalactic order, while the heroes struggled to keep them on board as they battled the remnants of the Empire at edges of New Republic space.
There could've been Imperial fiefdoms all over the place keeping a tight leash over worlds still under Imperial control, and member worlds with corrupt governors trying to play both sides against each other to secure a better position for themselves. There could be wars for liberation and betrayals, new worlds coming into the fold and dissatisfied member worlds defecting to the Empire or breaking off on their own at the wrong time. Luke struggling to establish a new Jedi Order and provide guidance to young Force users, while trying to rediscover lost Jedi lore. Lots of political intrigue going on in the background as they struggle to establish a stable new government and thwart attempts from hidden Imperial Agents against the new Prime Minister's life, etc.
But they blew it and now that chance is gone. Resetting the entire franchise to some distant, barely connected era without establishing WTF happened after the heroes defeated the Empire and what direction the galaxy took afterwards would've made no sense. Same way that the crap they did in the actual movies made no sense, because it was all up in the air. It's like the originals never happened and nothing they did made a difference. Now they were fighting a new version of the Empire at some undefined point in the future, because...reasons. Setting it one thousand years in the future with some unrelated generation at an era where everything from the timeline of the originals was gone and little recognizable to tie it back, yet still calling it "Star Wars" instead of something else, would've been even more confusing.
There is no "saving" Star Wars and there's no salvaging it anymore. And there's no reason to try, cuz it's not like we ain't over saturated with entertainment. It ain't the 70s anymore. Sci-fi flicks with cool special effects are a dime a dozen these days and there could be much more--far too many franchises that haven't even been tried yet, to get stuck on one franchise that they already ruined. They fucked it up, good job. It's time to move on.