Square Enix did release a 90s-style JRPG recently. It's called Octopath Traveler, and it reviewed + sold pretty well apparently.
The issue Square Enix has now is that they're the de facto big budget Japanese RPG experience on the market. There's no one else in the entire JRPG industry that has produced better visuals or a higher level of graphical performance than they have with Final Fantasy. So the challenge for them is to maintain this reputation -- which is becoming increasingly difficult due to the rising costs and prolonged cycles of game development -- while also still reinventing the series with each new mainline installment.
Part of me wonders if Final Fantasy should become more like The Legend of Zelda. We've seen Nintendo experiment with different art styles for pretty much every game, none of which are graphically demanding. And with each new entry in the series we see a reinvention of gameplay mechanics while core elements of the series are still retained to some degree. Maybe if Final Fantasy XVI is a massive shakeup of the series in the same way Breath of the Wild was, Square Enix can recapture some of that magic from earlier days.