I very much hope there might be some truth to this
however, just for the sake of the argument here's a few counter points to that.
I think it's way too early to assume anything about the battle-system at this point. The only thing I'd clearly rule out would be it being round-based, which is something I applaud as well. I am quite the fan of FF7's battle system, as a matter of fact its round-based core, with the brilliant materia-system on top of it is still probably my favorite combat-mechanic alltogether.
That being said, with its arena stages and turn-mechanic it wouldn't really fit into a game-aesthetic that the remake now is going for, which is much more pseudo-realistic instead of clearly game-y over stylized like the original. Curious how they'll implement the materia into whatever that new mechanic is. I mean magic and summons is pretty obvious, but with the more funky ones like counter/2x-Hit/block/mime etc. it gets interesting^^
With what we're seeing of the combat so far, it perhaps might look a bit like versus, but could also be anything really. The only thing we see is the characters doing their combat thing (and character switching, yes) plus the UI so far, which as far as i can tell seems like a placeholder to me. Just for comparison think about how the combat in the nearly finished FFXV-Demo is still subject of change for the final version (whole new blocking-/ targeting- and magic-mechanic, different limit-mechanic, new/different combo-mechanic), so I can only speculate what the FF7R combat will look like, with it assumingly being still in the early to mid stages of development.
Lots of comparisons have been made to Versus, to KH3, to CrisisCore and to XV, maybe it'll be like one of these, maybe a mixture, maybe sth completely different, but so far these all seem more or less equally reasonable.
Also about how far in development it seems to be, I too first was surprised to already see actual ingame footage of sorts. That being said, this could very well be just some of the first level-designs with an extremely rough/early stage combat-system slapped onto the XV-engine. It doesn't really need to be that long into development for sth like that i presume. On the other hand thank god they finally don't have to develop a whole new engine for their game so that's probably already a huge load off the developers back, plus the story+universe itself is already written. One could probably make the point though, that it might be just as hard to adapt an existing story to a new narrative as it is to write a whole new one, if not harder.
Your speculation is obviously just as valid, this just as a few points to maybe consider
Also regarding the points about (HD-)remakes in general I agree for the most part. Especially the ones that just supersize the textures and beef up resolution (and maybe UI or sth) are pretty much pointless in the best case, in the worst case they even destroy the originals "charme". For FF7 however it's a bit of a different cup of tea. The medium has changed so much, the possibilities and the aesthetics as well. It may be the same story, but how the narrative will be directed is a completely new thing, voice acting, camera-movement, cutscenes, facial animations etcetc. so despite this being "just" a remake, it is more comparable to a new adaption. Think like the adaption of a book to a movie (obviously not quite as much, but certainly a bit more in this direction).
That all being said, if the game really has been in development since 2012, if pre-existing engine+story really speed things up a ton, could we [pinkflowerdreamglasses=ON] perhaps think about a release 2017? 20th anniversary anyone? [pinkflowerdreamglasses=OFF]
yeah yeah, i know it's probably 2078 or sth, but a boy can dream, right?