Part of the problem is like Sean said, the old studio guys left. The other part is the new guys refusing to use anything of the old formula. A lot of people have begged for a FF7 remake and a return to the "old style", but the new crew absolutely refuse and want everyone to recognizetheirstuff. Too bad a lot of it pisses off the fans.
The thing is in my opinion, there isn't a rift between the new and the old style. Shinier graphics and cooler cutscenes sure, but the main difference is the story, characters, sounds, world and so on, stuff that is purely artistic. Mechanically I don't think FF7 was any better than most of the more recent FF. I mean FF7 didn't have insanely good combat, it was very very run of the mill ATB, and the progression system for the characters while interesting wasn't unique or the best ever, it was just good. The problem is, if you try to make FF7 and use the same materia system and the same combat, you'd still fail unless you can write the same kind of story with the same kind of characters. This is what Squeenix has failed to do for years now, they cannot manage to get both good chars and good story together. Or good story at all really. X had pretty good chars and world(loved the water sports thing) but story was fairly poop, I have no idea what happened in XII nor do I remember any char from it so it was most likely horrible and XIII had bad characters and bad story, but in my opinion far superior combat to most of the FF ever before.
The issue isn't that they don't copy the older games, the issue is that they CAN'T copy the older games because they don't have the talent to write the stories like they used to. I mean sure there's also weird choices like the corridor system of FFXIII for 1/3 of the game and shit but that alone didn't make it a bad game imo. The fact is, I hated most of the chars because they were obvious and completely bland, and then I hated everything they did because the world and story were retarded.
Even more important then the world is I think, you need good characters. If I try to sum up why I liked FF6 and FF7 in a few words, it'd be Shadow, Kefka, the Opera, the destruction of the world; Cloud, Sephiroth, Aerrith dying, the link between Cloud and Sephiroth. The new FF have nothing of that sort, or when they try it's flat and uninspired, the characters are bland, typical anime stereotypes and almost none of them even play a major part in the actual story. That's what ruins the FFs.
