'Nostagia', as a broad, sweeping dismissal of the appeal of older games, is a terrible argument. Some games age way better than others, and some of them I didn't encounter until years after they were first released. I couldn't afford to buy Super Metroid for £65 in 1995, but playing it through in 2010, it's still a sublime experience and wiped the floor with virtually everything else I played that year.
What's even worse is that it's often used to discount the few games we do remember, when the reason they are remembered so fondly is that they are the better games of their generation. Off the top of my head, I'd struggle to remember many of the awful games I've played over the last three decades, but I can probably remember all the great ones that I've revisited and found to have aged incredibly well.
Just because older games require players used to almost-universal modern console control schemes and being explicitly told what to do and where to go to sit and get their heads around a system that's probably unique to that title doesn't make it any worse. Being unable to appreciate something for being groundbreaking at the time is like sitting in a cinema and thinking Metropolis is awful because it doesn't have any CGI and is in black and white.
Where people sit and critique an individual titles flaws (and FFVII has many), that's cool. We certainly weren't exactly oblivious to them at the time, either. But when 'nostalgia' is used as a blanket dismissal of entire catalogues without any clear, specific reasons why, I just find it laughable.