FFIX isn't really classic fantasy in that it has steam punk technology and airships. Every FF is a blend of ______ setting (fantasy, modern, or something else) mixed with science fiction. This has been true since FF1.
That said, FFVII's setting is something special.
FFVII isn't a game for battle system difficulty, however. FF hasn't been about challenge since the NES days, though IV can have some occasional challenge due to its structure but only the first run. XII and XIII are minor exceptions in this area, beccause they both require the full use of a spell roll out in order to win. That said, VII can be fun despite its easy difficulty, and contrary to what Rumbler said, the rest of the game is full of highs. Especially disc 1. Stick with it. If you're playing on pc there are difficulty mods, but as an FF beginner I'm not sure if I should suggest anything like that.
If you want FF's with challenge, my picks are FF1, FF2, FF3, FF4, FF5 (four job festival preferred), FF Tactics, 12, and 13.
If settings are your thing, VI-X, and XII are as good as any.
If you're hankering for battles, fun, and depth, FF1, FFV, FF Tactics, FFVIII, FFX-2, XII, and parts of XIII are suggested.
A masochist? Try out FFII.
Want a great story? Try out Tactics, VI, IX, X, and XII.
Final Fantasy has a lot to offer but it depends on what you want at any given time.
