That's good to know if true.
I have to disagree about your second statement though. I think 2 games at once with 2 teams is a tried and tested development process that has worked very well for the majority of high profile Western developers. Concentrate on one title while doing the ground work on the second, release the first and then go into full production the the second, while beginning pre production on your next title. That allows a company to avoid development hell on one game because they announce it to early while juggling to many other projects.
Saying Square Enix should only have two games in development simultaneously is almost the same as saying Sony or Nintendo should only have two games in development simultaneously. Square Enix needs to release more than one game in a year.
Besides, they already DO what you want them to do. The production of their games advances exactly like that. They always have small teams begin projects and they'll move more people to finish the games that are the nearest to completion (i.e. the game is put into "full production", which FFVsXIII should have entered in ~Q3 2011). I'm getting tired of repeating this, so I'll put it this way (a rought timeline for Versus XIII's development I've pieced together from interview tidbits and comments, not saying this is 100% accurate but I've followed this game VERY closely, so I don't think this has too many errors):
Q2 2006: Versus XIII is announced. Development, however, is not begun for the next ~1,5 years because Nomura had just come off of Kingdom Hearts II's development so he was just in the beginning stages of planning for the game. He was also busy with numerous other projects and the KH team was put to work on different games.
2007: small tech team starts working on figuring out what they can do with the hardware they are working on, they do all kinds of tech demos that test the limits of what they can achieve with PS3 (they, at the very least, had world map & airship tests, and made the cutscene with Noctis & Stella at the party). Nomura & Co feel this is necessary before going on with the development of the game because they don't want to have to make any compromises to their plans for the game.
Early 2008: Crystal Tools are somewhat finished, so they begin working on the game
From mid-or-late 2008 to late 2009: the development team of Versus is put to help finish XIII, so development of Versus is put on hold for (over?) a year
From early 2010 to mid-2011: a relatively modest sized team is developing the game (I've gotten the impression it's been maybe in the range of 40-60 people, which is really small for a big-ass game like Versus XIII)
Mid 2010: we see the first glimpses of Versus XIII gameplay, very early (they didn't even have a somewhat ready command menu to show)
Sometime in Q3 2011: Nomura says they had recently entered "full production", meaning they build up the size of the team to just start churning out the content of the game, after having the basis of it all done. Oftentimes, for Square Enix games, this means the game is about 9-18 months away from release, depending on the platform & scope of the game (i.e. Type-0 was put into full production in early 2011 after 3rd Birthday's release, which the Type-0 team co-developed, 10 months before release)
September 2011: Nomura says the world of Versus XIII is at least somewhat complete and fully traversable, as he had just finished exploring it. However, it sounded like they still had to actually fill much of that world with content.
So, really, by the time we saw what we saw in the January 2011 trailer, Versus had been in development (outside a tech demo-y stage) for maybe 1,5 years or at most 2 years, with a relatively small team for the size of production it is
and in this time they had made some pretty major design change decisions from their original plans for the game that set them back in development a bit (i.e. major changes to the overworld, decision to make/change a big part of story-advancing scenes at least somewhat interactive so that the player remains in control of the character instead of having to just sit there and watch them as cutscenes). So... really, the game has really been in development for about 3,5 years now (again, quite a lot of that with a small team and it hasn't been a 300 man team working on it all that time), and considering how big the game will seemingly be, how polished it will quite likely be and how great the audiovisual side of the game is, I don't think that's at all too unreasonable a development timeframe. Really, the only thing Square Enix has done wrong with the handling of Versus XIII is that they announced the game way too early. Had they not announced it in 2006 but maybe in 2011 with the 2011 trailer, people would probably just have assumed Nomura mostly worked on all of those Kingdom Hearts games and not be that whiny about how Square Enix is worthless for not getting one of their games out, when in fact Nomura has just wanted to be well prepared for the game's development instead of rushing into without having a full grasp of what they are working with.
Re: Morale - Believe me - regular scheduled meetings on a project running for 6 years? I'd be hoping SE have super reinforced glass in their building because that would drive anyone nuts. I know they are a necessity but... at some point....
No one has worked on this game for 6 years. Also, the last time Nomura spoke anything about the morale, it sounded like the morale was really GOOD. He said that the people around the office had a similar feeling that they had when they worked on Final Fantasy VII.