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VII always seemed to me to have a lot of horrific elements in it; but, being that they are trying to make games (or so it seems to me) that are teen or less in ratings, they have to be careful with what they do in their games. They can't show a lot of blood or gore.
A few of the Final Fantasy games have elements that could very easily be made more creepy, more horrific, with little imagination or true hard work. Cieth in XIII and XIII-2, also what was done to fal'Cie Eden in XIII-2; VII with all the scientific experiments done by Hojo and his people, not to mention Sephiroth and Jenova; XII had the undead warriors (a few games did), which to me is pretty horrific.