Final Fantasy VII Remake have probability to retain is original Turn-Based gameplay and be similar to Final Fantasy IV (3D remake) & Bravely Default. That could bring Square Enix lots of profits, since they could port it to many platform such as 3DS, Vita, PS4.
Not to forget Android & IOS. Final Fantasy IV (3D remake) is available on Android & IOS and have been selling very well.
Some would argue for Turn-Based game that also tries to max out PS4 graphics. But there's a problem called "Immersion". Because of Final Fantasy VIII was getting too realistic, the Turn-based ruins player's immersion in the world. Thus Final Fantasy XI art style was design to minimize immersion disturbance when turn-based occurs.
On another thought, Final Fantasy VII Remake can be the continuation of Crisis Core: Final Fantasy VII, making the remake an ActionRPG.
Which gives a measure of gameplay coherency among Before Crisis, Crisis Core: Final Fantasy VII, Final Fantasy VII, Dirge of Cerberus, Dirge of Cerberus: Final Fantasy VII a factor for the remake an ActionRPG
Huge investment on Final Fantasy XV / FF15 & Kingdom Hearts, can also be a factor for making Final Fantasy VII remake an ActionRPG.
What's the best way to improve SquareEnix's ActionRPG development capabilities is to make the most of their game ActionRPG, as other Game Developer have proven, such as BioWare's Mass Effect, Dragon Age, Bethesda's Elder Scroll series, Rockstar's Grand Theft Auto series.
Or do Both.
One Turn-based Final Fantasy VII remake for 3DS, Vita, Android, IOS, etc. Low risk, high profit & rating.
One ActionRPG Final Fantasy VII remake for PS4, made with all the experience gained from Final Fantasy XV, Kingdom Hearts development.
There's still some fans wants gorgeous graphics that tries to max PS4 hardware with Turn-Based Gameplay. Switchable gameplay mode can be made.
You want to stay in an immersive world? There's ActionRPG mode.
You want to wait for your turn? there's Turn-Based mode.
Keeping the old fans happy and inviting new fans into Final Fantasy.
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I would prefer the game being turn based, not a hybrid system. By turn based i mean no ATB system. Maybe give other people a choice for it to be that way.
Id keep the game fait full to the original just redo the visual, audio, make voice overs and add more content and stuff to the already massive world and sub games.