Complaining that GRIN hadn't made a good game is irrelevant; neither has Square-Enix.
Terminator was bad, and
Wanted: Weapons of Fate was mediocre, but GRIN's this-gen
Bionic Commando was considered quite good by some players here on the 'Bore, wasn't it? And the XBLA
Re-Armed game was inarguably good, and as Backbone has shown with
Bomberman, it is possible to screw-update an apparently bulletproof gameplay.
GRIN was far from perfect, but this sounds as though S-E was just backing rapidly away from GRIN and its recently acquired bad reputation.
So, to test the waters at Square a bit, and to see if it was even paying attention, GRIN sent it some concept art from taken straight from Final Fantasy XII .
The Anderssons were told: It does not look like Final Fantasy.
Fantastic 
Fantastically
final, you mean.
