The thing was, some (most tbh, like anything) of that innovation was shit, and it was the shit parts that stuck for some reason. I had a post somewhere else detailing this stuff before, but I'll reiterate some here. Using FF series as an example:
FF7 was the first of the series to cut equipment slots down to 4. (2 if you're not counting accessories.) Materia somewhat made up for this, but materia was interchangeable between any characters and any slots, so it wasn't really the same. FF8 took this even further and nuked equipment entirely, leaving only a weapon slot that did basically nothing. Even the ancient FF1 had 5 slots + vancianish magic. Huge decline in party customization here, where before all sorts of cool shit was possible and the exploration aspect was more exciting because of the prospect of finding unique equipment with some effect that couldn't otherwise be acquired.
FF7 also marked the end of significant differences between characters aside from limit breaks. FF9 and 10 gave them back some stuff, but generally speaking having a party comprised of disctinct characters vanished into a blob of interchangable characters that could each do everything. This was a massive decline compared to the differences between characters in FF6, or the massive set in stone differences one would create in FF5 by building characters along certain paths. You could honestly strip any character in FF7, dump their materia on another character, and it would almost never matter at all.
Spoony touched on this in his FFX review, and though I never thought of it before, FF7 was the point where they stopped giving a fuck about making remotely plausible characters and equipment. Cait Sith's weapons are fucking megaphones. Red XIII wields fucking HAIR CLIPS. Even Setzer at least used darts and implied his dice were some sort of magic attack.
FF7 also began some traditions I'd have happily seen quickly disappear that instead stayed around forever, including chocobo raising minigames and limit breaks shamelessly stolen from Lufia 2. FF6 had a pseudo limit break system, but it was so rare and unreliable it was more like an easter egg. Limit breaks are actually some of the better parts of some later FF games, but it's being used as an obvious crutch and at the cost of other potential ways to differentiate characters.
FF8 actually nuked the idea of equipment stores. They've never really come back properly. Actually, FF8 didn't even have a proper money system, instead having some weird and unexplained 'salary' system, which amounted to a set amount of money over a period of time based on doing quizes and finishing battles without summoning GFs. Not that you needed money for anything ever.
FF7 marked the first use of cinematic time wasting at the beginning and end of each battle. Because moving the camera around is SO COOL and people's time is not valuable, and nothing could be done in a game that would be more interesting than panning the camera over the same terrain every minute. It also marked a sharp increase in animation lengths of various spells and battle effects, particularly summons. God only knows how much more interesting materia they could have added if they didn't have to animate
THIS.
FF8 marked the end of secret/optional party members. Everyone in and after FF8 is a mandatory party member.
Haven't played through FF12 or 13, but to my knowledge, FF7 was the last in which a party member ever died. People make fun of the aeris thing, but at least they had the balls to kill people off back then. FF4-7 all killed off party members. Dunno about earlier ones.
There was tons of good stuff back then too, a lot of my favourite jrpgs are on the PSX. It was a time of both incline and decline, but sadly only the decline lingered on.
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