The dungeons in ALTTP were just as short, if not shorter than the ones in A Link Between Worlds. Personally, I think I'd rather have 12 (if you count) shorter dungeons that never overstay their welcome than 7-8 long ones. *shrug*Hyrule Castle
And according to the Iwata Asks interview, it actually wasn't going to be a remake. It started with toon Link from Wind Waker and they were going for something completely different. It was later that they decided to make it a sequel to A Link to the Past.
No it was still going to be a sequel, it was just going to use Wind Waker Link (again) and have the same shitty controls and style as the DS titles. Miyamoto heard about it, told them the idea was shit so they chaged it to what we have now.