There's so much wrong.
96-00 - the same engines and transmissions for the base and SR5. They drive the same. Get the 1999 Highlander if you love fake hood scoops and only two choices of color. The 2000 Sport is pretty much the same and you get Millennium Silver and some color keyed flares to go with your color keyed bumpers. Regardless, it drives the same as a 1996 SR5.
The real difference is in the 99-00 Limited. That multimode transfer case is by far the most functional and performance oriented upgrade, AND you can get a rear locker. The ABS system is the same from 1996 to 2000, this forum just narrows it down to being a 96-98 problem because they feel like they are disrespecting that fake hood scoop. The ABS isn't really a problem, but I think the pumps wear out after time causing an issue. I have one 96 with good ABS and another with bad ABS. Best advice, slow down when it's snowing so that ABS doesn't trigger anyway.
So yeah, the main functional advantage to 99-00 is multimode and cupholders that work. I guess the clear headlights kind of make a difference, but unless you do a projector retrofit you're kinda just bragging about how your headlights are less shit. Kind of like arguing about who's grandmother was hotter 60 years ago. If you're dead set on a certain color then you need to focus on certain years, disregarding the fake scoop and cupholders, which can be added later.
01-02 - you lose the locker, manual, and 3RZ. You get drive-by-wire and a slightly less durable A340 transmission as a consequence. They are still above average in reliability, but they definitely have proven to be more fragile than 96-00 A340s. The VSC system is an early variant, which just means that it sucks ass and cuts power every time you decide not to drive like a little *****. They all have dual cats which becomes a pain in the ass of P0420 codes after 15 years. They ALL have multimode, but they just made the way to engage it a little easier for stupid people who get scared of moving levers. I will admit that I have a serious fetish for the stellar blue 2002 Sport Edition. That monotone stellar blue goodness and coke bottle wheels just look so right. These years also have better sound deadening from the factory.
So yeah.