Yeah, I can agree that she was inspired by personal experience of the creators putting it into their story. Sure thats great. But typically (and I am not vouching for all gamers) most people who play RPG's want to play a story w/well developed characters and an engrossing plot which, yeah, isn't full of plotholes.
Another note, on creators personal interest in their games. I really don't think most gamers would be interested in (for instance) knowing that Giygas' dialogue in the final battle of Earthbound is inspired by (and I take a direct quote from Wikipedia) "a traumatic childhood experience where he (Shigesato Itoi the creator) mistakenly walked into an adult movie theatre and caught a glimpse of a sex/rape scene in the 1957 movie Kenpei and the Dismembered Beauty". Not exactly something you want to know, BUT, surely interesting trivial material.
I agree, Sakaguchi is a genius, when it comes to putting together a game. Final Fantasy VII however, is just a giant cash cow now for Square-Enix, which fanboys and fangirls easily sway into. NOT TO SAY, that some of the titles they are releasing aren't good, BUT, it is going a little overboard.