A lot of people THINK they want a FF7 graphical update, but I think Sony is right in they feel the support is not there. It's true that FF7 was the most commercially successful FF to date,but Sony was keen to the truth of modern day support when they tested the water with the FF7 re-release, and the sales were barely above 100k downloads. That pretty much confirms their suspicions that the modern generation doesn't care about FF7 or most of the classic RPGs really. Sure, they likely would have had more reception if the remake had the graphics of the PS3 tech demo years ago, but that would be an enormous effort. After all, FF7 wasn't a 3D game it was 3D sprites on 2D prerendered backgrounds. That is to say, you would have to literally make an entire next-gen game from scratch just to satisfy a small population of nostalgic fans from 15 years ago.... not a good investment.
Sony pretty much alluded to it, and I'll say the unpopular truth: FF7 was a generational-defining RPG THEN, but its not NOW, nor would it be even with a graphical update. It's not a big deal anyway, just play the classic. I thought it was funny they remade FF 3/4 into 3D, though.