Okay, once you break this game in it starts to get pretty damn good.
You have things called mediums. They're very similar to GFs in terms of use. You equip a medium, and it has set skills that you can learn, from jump (the ability to place anyone who is on your hex to any other hex on the battlefield that is not occupied by an enemy) to physical attacks and magic attacks, buffs and debuffs. You can learn any medium at any time but you have to have enough points to learn them. The cool thing about mediums is that in order to learn a skill, you have to use gc points. GC points themselves aren't what's interesting, but the fact that the more gc's a skill requires, the more hp the skill needs in order to be learned. Learning a skill decreases your hp for that time. You can learn multiple skills at once, but that means you'll have considerably less hp.
Now, this wouldn't really matter if the game didn't have such a strategic battle system. As I said before, your guys get placed on hexes. If you or the enemy are on the same hex, you all get attacked, and the damage is usually higher than normal in this case. Thing is, enemies will jump you and pincer attack you and fuck you in the ass. Avril's hp on my game right now is around 500. Most attacks from the monsters on the field take up 200-300 damage now. With one or two attacks, she'll be KO'd. So awesome.
Enemies will use skills will force your whole team on the same hex, and then they'll move on to the same hex and rape you. The game's AI can be brutal sometimes depending on the enemy type, and it's fun. It's to your advantage to spread your team mates out and force enemies into their own hex, but that can also have its drawbacks: 1. you can't use a combo if your characters are spread out, 2. Your enemies will be able to heal all of eachother using one item, so it's best to decide whether you force your enemies on the same hex or let them use seperate hexes. What ever is to your advantage. But to reiterate, do not lower your hp to disastrous levels or you will find your characters dying in one turn. So awesome.
One thing that factors fun into this are Force Points. FP is kind of like a super meter bar for a fighting game. It gauges what type of attacks you can do and when. You gain force points by doing practically any action whether it's attacking, guarding, or being hit by an enemy. I said before that enemies will rape you if you are on the same hex, but the flip side to that is that you typically gain more force points in those situations. Force points allow you to do multiple things. They can let you Jump your characters across the battlefield to another hex, they allow certain other abilities, but best of all they allow combos. But the game doesn't stop there. This battle system (so far) is pretty damn balanced. The enemies can use FP too, and they will rape you once more if they have enough FP.
The combos in the game own. Any Chrono Trigger fan should see the combos in this game. *wipes tear*
I don't even know what creates combos but they're awesome and can really turn the tide of battle.
Further still, the game offers even more customization. When you get certain items, you can customize your ARMs at save points and invest your points into three seperate attributes.
Once the game introduced all of these elements, the game kicked it into high gear. I'm very impressed. The battle system is pretty balanced so far, and actually strategic. Much like other srpg + traditional hybrid rpgs, the battle system makes my pants hot. It would make Dragon Quarter and Valkyrie Profile 2 proud.

Not to mention, the game has HEXES. Hexes are awesome and infinitely superior to tiles. Hexes are awesome.
I've actually died a few times from NORMAL battles. Outside of SMT and a few other jrpgs that is unheard of. BRAVO! For people scared of games that have (awesome) cheap deaths, you don't get a game over if you lose a battle, you have the option of starting the battle over and retooling your strategy.
This is worth checking out. If you like Wild Arms, western settings, or jrpgs with non conventional battle systems, you should probably check it out. It's got a traditional story, but traditional's not bad if done right. It has a lot going for it. Between this and Persona 3, and (hopefully) Growlanser V next week, ps2 pretty much ended on a high note. ps2 <3
I wouldn't say the encounter rate is high. On the world map, sometimes, but in dungeons you can go walking 30-40 seconds without a battle.