While I doubt that Sony or Square could be colossally stupid enough to slap new graphics on top of a nearly 20 year old game engine... let's face it, dumber things have happened in the gaming industry. I'm curious how they intend to handle it though... there's now literally an entire generation of gamers who have grown up with the legacy of this game, but never really played through the original, so they could get away with simply recoding the old levels and script with a new graphic engine, skinning the old text box interface as a sort of retro-chic... on the other hand, they could also knock it out of the park by adding in new story elements, combat systems, and areas that that now-ancient platform simply couldn't float.
Done right it could be something amazing. Done wrong, it will be something worthy of epic ridicule.