Not trying to be negative or anything but thats going to be the heck a lot of work. First of all, the most difficult part will be remake of the engine. The pre-rendered background systems used by the final fantasy series(7,8,9) is a complex piece and emulating this will take a lot and a lot of time(Ive personally tried it for my ff game which is still in the making).Real time levels(in ffx or ffx-2) could be a very nifty solution but thats up to you guys if you wanna use it(perhaps it wouldnt suit ur ff7 remake).
Before going deeper, try to make a feasibility study of what you guys can do and what you cant and stick to that(for example the feasiblity for the models:do u have someone draw them,model them,texture them,animate them,etc). In this way, youll know the scope of your project and in this way, I hope you won`t abandon half way.
