Despite the Commodore 64 being the best selling computer model of all-time and being manufactured by a US company, all the major vintage enthusiasm for the machine seems to be centered on its presence in the UK and Europe. In NTSC countries like the United States and Canada, there is arguably much more of a vintage interest in the Apple and Atari 8-bit computers.
In Europe, software for the Commodore 64 came primarily on cassette tape. The Commodore 1530 C2N Datasette was competitively priced, the Commodore 1541 Floppy Disk Drive was not for what was came to be seen primarily as a games/hobbyist machine. Virtually all European software came on tape, while only the pricey US imports like Ultima and Wizardry came on disk. Cartridges, which were not dominant in the US after 1984, were seldom seen in Europe.
The tape medium imposed sharp limits on the varieties of games that could be played on a C64. A full load of the 64KB of RAM took several minutes from tape, and once loaded, that was it for the game. Since precise loading of data from one side of a tape was not very friendly to the player, one side of the tape equaled one load of a game. Platformers, shumps, soccer (association football) and fighting games were very popular genres. Turn-based strategy games, lengthy text-based adventures and RPGs were not popular on tape. Imagine having to fast forward a tape until the counter reached 200, 300 or 500 to load a town or a map. Wasn't going to happen.
The real problem is that most U.S. developers came late to the Commodore 64, having cut their teeth on Apple or Atari computers. To most developers, the C64 was just one more machine that would need a port of a popular game. Eventually U.S. developers did develop some games natively for the C64. Maxis' Raid on Bungeling Bay and SimCity was developed for the C64, as was Microprose's Gunship and Sid Meier's Pirates!. Activision contributed Little Computer People. Lucasfilm offered Labryinth, Maniac Mansion and Zak McKracken and the Alien Mindbenders, and from Electronic Arts there was Skate or Die! and Interplay contributed Neuromancer. SSI developed its famous AD&D Gold Box engine for the C64 including Pool of Radiance and Curse of the Azure Bonds. Epyx was prolific when it came to C64 development with Impossible Mission and other classics, but unfortunately that company foundered on what would become the Atari Lynx. By the end of the 80s, all these US developers had shifted their focus to the generic IBM PC Compatible platform.
Many US-originated games are popular with Commodore 64 enthusiasts, even in Europe. LucasArts' classics top many lists, and you can usually find an Ultima, M.U.L.E., Wasteland and others. On more than one list of the top C64 games, roughly half come from US companies. However, I have heard more than one commentator say that the NTSC C64 is crap and that you should get a PAL one instead. Most US games will work (18% more slowly) in a PAL machine, while most of the good PAL games rely on timing that will break in an NTSC machine.
Many European C64 games were not as widely ported. Some went to the Amiga, and some Amiga games like Turrican received very high quality ports to the C64. While many games were ported to the ZX Spectrum, no one was going to favorably compare a ZX version to the C64 version, except perhaps in price. Many companies decided develop their advanced efforts on the Commodore Amiga (the 500 was priced well in Europe) or the Atari ST instead of the boring PC clones. Other than Cinemaware, US developers did not really embrace the Amiga, and the Atari ST and Apple IIgs saw even fewer natively developed game titles.
One great advantage of the Commodore 64 is that virtually all the classic US PC games of the early and mid-1980s, and even many late 1980s games, found native releases or ports to the system. Some of the later Infocom games require a Commodore 128 to play (A Mind Forever Voyaging, Beyond Zork, Trinity) and some can take advantage of the 128's features (Ultima V, Hitckhiker's Guide to the Galaxy). Developer interest virtually disappeared in the Atari 8-bit line after 1985 outside of Atari, and the Commodore offered far superior graphics and sound to the Apple II line. By 1988, PCs had come down sufficiently in price that game developers could target them. Decent graphics (EGA) and sound (Adlib) made the PC less of a chore to develop for than in the days of CGA and the PC Speaker. However, the advent of affordable hard drives, and the enormous increase in functionality they provided, really helped establish the PC as a programmer's best friend.
The use of cassette tape had its advantages as well as its drawbacks. Since the tape usually took some minutes to load, the programmers could send a static picture first and a musical tune to entertain the player while the game loaded. The disk was faster but servicing it seemed to require the computer's total attention, so this sort of thing was not common for disk games. Another advantage of the cassette game was that they were easier to copy and rip than disk games. Cassettes were cheaper than disk, and the games were generally much, much smaller. It's quite easy to distribute most of them as a simple Commodore executable file these days if you just want to play the game. It is not so easy to do that with, say, Ultima V, which came on four double-sided floppy disks.
If the C64 has an Achilles Heel, it is undoubtedly the speed of the disk drive. The standard speed was only 300 bytes per second. An IBM PC Floppy drive was faster by almost two orders of magnitude, and even the slower Apple II and Atari 8-bit disk drives were faster. Some have been converted from their slow floppy format to more mass-storage friendly solutions, but there is a great deal of work to be done in this area. But perhaps it is this reason, most of all, which tends to put off US gamers from the C64.