These are frankly strawmen.
You are ignoring glaring holes in your argument: you mention REmake was a product of its time but fail to apply that same logic to FFVIIR which was announced in 2015, a time when menu based jrpg battle systems still exist many of which made by SE themselves such as Bravely Default, I Am Setsuna, and even Final Fantasy games like World of Final Fantasy. They've even re-released the original FFVII as well as VIII (pc) IX, X, and XII. All of which have menu based combat. Are those games not products of their time if SE think they're good enough to re-release for modern systems? VIIR therefore is not a "product of its time".
You are just making excuses for the fact that SE does not have confidence a turn based FFVII remake would sell like an action-based one. Hence, they are ashamed of their origins and/or need to turn a profit. And if you can't remake a game without it needing to sell 10 million units or change the gameplay to the point where it's an entirely different game altogether - unrecognizable to the original in everything besides in story - then I think it's fair to concede the remake shouldn't exist to begin with.
The symptoms here are nothing but greed, director oversight (thinking there's something vastly wrong with the original in a George Lucas, Walter Hill sort of way to the point where you feel you have to meddle with what makes it works), poor management, and over ambition that exceeds the necessary requirements needed for a remake.
If I were to remake FFVII, I would give it the REmake treatment. Insert visible enemies, voice acting, have combat be a combination of FFX-2 and XII but taken to 100, cinematic camera angles to mimic the original pre-rendered bgs but they're actually with 3d models, expanded locations, updated art direction (one of the very few things I like about the current VII remake), bigger dungeons, remix it so that you can sequence break certain segments or do things in your own order, change things to fuck with players, upgraded difficulty. With UE4 this remake could be made in two or three years. Instead, Nomura and co. want to innovate and break barriers. With a bloody remake.
I'm sorry but it's very obvious to me which approach is better.
Remakes are not for barrier breaking and innovating. They're for taking formulas and making them better. That's it. I don't see how that's controversial to say and the fact SE thinks a remake should be ground breaking shows how stupid the company is.