Long ago when the Mass Effect 2 was announced the creators ask us to keep the saves from Mass Effect cause it will influence the story but with the first trailer it looked like Sheppard was KIA and youll get to play a new character. I was like... how could the saves from Mass Effect affect the game if the main character from it died... Glad it turned out that Sheppards alive and we will get to play with him again.
He isn't dead but he can die at the end of Mass Effect 2 depending on your decisions which means it is almost certain that Commander Shepherd will not appear in Mass Effect 3 - one of the lead designers has said making the third one will be easier because they don't have to worry about continuity.
I've just played and this morning finished the first one after three days of intense play. I lost my saves after completing it the first time and was surprisingly a lot more thorough this time around, hitting the money cap (9,999,999) and getting close to the "first playthrough Level 50" cap (I was at least level 48).
Everything about Mass Effect 2 looks as though it is going to be better than the first, I just really hope that's the case.
Combat is changed and abilities have been severely altered. There are 19 weapon types instead of 6, grenades have been removed and while the first one had points you could use for weapons and armour to make you proficient with them, that now is not the case. There are no armour restrictions and with weapons you're either proficient with them or you're not.