It works so perfectly.

pretending the order of the star wars films is IV, V, II, III, VI.  At the end of empire where they’re looking out into space works perfectly as a change to a flashback period - that’s where 2 & 3 come in.

It works because:

• the phantom menace is completely irrelevant to the plot of II and III,  
• jar jar gets removed,
• the worst film of the series gets removed,
• midichloreans get removed,
• vader as a little fucking faggot kid gets removed,
• the terrible acting gets removed,
• padme refers to anakin as ‘that little boy i knew on tatooine’, they both look relatively similar aged at that time so you can assume they were just childhood friends without taking into account the weird age gap they had in Menace,
• Obi Wan has a beard for the entire duration of the series,
• Anakin Always wears black,
• This order preserves both twists, if you watch the films in order of episodes, the biggest twist in the history of cinema of vader being luke’s father is ruined in episode one. So is the twist that Palpatine is actually darth sidious manipulating the trade federation when Darth Sidious is actually mentioned, from that point on it becomes pretty obvious,
• it keeps the fact that Luke and Leia are siblings a surprise, it simply moves the surprise to Episode III instead of VI, when Padme announces her daughter’s name,
• After you watch episode 3 and come straight back into present time with episode 6, you see luke reject the dark side immediately after anakin succumbs to it, making it seem all the more impressive, you also develop more of a sense of sympathy towards Vader in episode 6 after just seeing the important parts of his turn to the dark side in a flashback with episodes 2 & 3,
•  it sends the viewer on a series of emotional ups and downs. A New Hope ends with a victory that seems to have some sinister undertones, then Empire is dark and unresolved with a cliffhanger, Attack of the Clones ends with victory with sinister undertones, then Revenge of the Sith is dark and unresolved with a cliffhanger again.. leading into Return of the Jedi perfectly to tie up all the loose ends.

(Source: static.nomachetejuggling.com)