True.
Are there no source files because back in the day people didn't care about keeping that kind of material?
In the old days, losing the source files for games wasn't terribly uncommon.
Granted, the fact that it happened for VII is a little jarring, but a little understandable.
The main basis for that is once the game's released, they typically don't have much use for it and unless the game ran into some major issues (re: game-breaking bugs and such), there's not a lot of point in keeping it.
On top of that, even if they did lose it, it'd have little impact on the company (with the exception of what I mentioned above).
Kinda crappy, but it happens.
Though I'd argue that keeping the Source Code is pretty important, just for various reasons and such.
(In the case of downloadable games and those in development, you absolutely WANT to keep it.)