Telika: It is indeed exaggerately theatrical. In the litteral sense, it's old-school theater play. It kinda works for dramatic tv series of that era (it is supported by the editing itself : shatner talks and moves around like a very self-conscious "epic hero", but camera angles such as dramatic down-top views at his appearance show that it is a collective intention), but it has aged even more than the rest of the series, now that tv/cinema has found its own "grammar", a more natural-like acting enabled by the "proximity" of the camera.
There has been a progressive de-theatralization of acting, in audio-visual medias (that style is now mostly present in parodies, and not just star trek based ones). And I am actually nostalgic of a certain amount of theatricality that has been lost. But Shatner may have been pushing it farther than anyone else, and may be
actually overdoing it a bit.
I think it worked fine for Star Trek, and works fine to this day. Patrick Stewart often remarked that doing Star Trek was not all that unlike doing Shakespeare on stage, as it has it has it's own hightened language.