Well, it's definitely not a prequel. Because let's face it, who would start out with an awesome knife like that only to switch to a lame kitchen knife in FFIX? And I'm guessing that blue dude is evil, 'cause well, he's got a blue armor and horns and I guess the skull on his belt helps a bit too. I don't know why he's so angry though, maybe he's another one of those alien gnomes in disguise.