I saw Prey 2 at E3 2011 and to be honest, I KIND OF get the reference to System Shock, even if at the time the whole "spiritual successor" rhetoric didn't surround the game as it does now with this new info.
There was A LOT to take in from the demo, and I left feeling confused but also very excited about the game. It had a Blade Runner feel about it, the graphics were crisp, and the gameplay had a level of depth I hadn't seen on a console FPS. There was a lot on show and a lot of different mechanics, and I always wondered how they would map all of them to a controller. I believe at the time the game was running on PC hardware but was played with a controller.
It was confusing but very intriguing, and unlike any FPS demo I'd seen in the past. I also sat in on Aliens: Colonial Marines that same day and Prey 2 seemed far more advanced (although, that isn't too hard, but at the time Colonial Marines looked very good - we all know how that turned out).
There was something different about it that I still can't quite put my finger on, and I've always been surprised at how the game just went into limbo. If anything I don't think it had to do with the game being bad, perhaps more to do with it just not being overly accessible, because from what I saw, I struggled to keep up with everything they were showing. It was confusing, but in a way where I just wanted to pick the controller up and learn for myself, not in a way that intimidated me (so, yeah, in the same way System Shock 2 throws so many different things at you but you just can't turn away).
It had potential. I think we'll never see that game, and Prey 2 is dead. I find any prospect of a new Prey bizarre. IMO they'll end of rebooting this current idea as something else entirely, and call THAT a spiritual successor to, well, Prey 1.