Well the fact that the last two Suda x Kozaki games mega bombed might have something to do with it. Really can't blame gungho for wanting a change in direction.
It's fairly obvious which side of 'x' is responsible for the bombas...
Now seriously
If you're talking about Liberation Maiden Sin, the VN is panned for its shitty story, which guess what, suda51 had some hand into the concept (he didn't write it)... most VNs don't sell more than a few thousands anyway.
If you're talking about that Short Peace hybrid disc game, it's a crappy sidescroller. Again the story is grasshopper shit, they didn't make the game though. IIRC the whole short peace thing was bomb anyway (bluray sales).
As for Kozaki's art you get what you ask for, the man has a very diverse output actually, from things like donyatsu to Fire Emblem, from suppressed modern looking designs to wild and messy like the stuff he's done for suda51...
Considering Nintendo went after him for FE, specifically stating his popularity as a reason, this couldn't be any more off the mark.
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I think they just couldn't make the game they wanted, Lily Bergamo concepts were actually first teased before Gungho buyout iirc. If you want to blame anyone, Gungho pushing for some f2p shit is probably more reasonable considering that they're an online company and after looking how things like Killer is Dead is megabombing every where they made the move. I doubt this game has anything to do with Lily Bergamo unlike what they say (seriously wtf!!!), they just canned it but have some obligations to Sony and they're just phoning this one in instead! </lots of speculation from everyone>