Knowing Square enix a japanese company, they like the preserve the original... but it doesn't translate well into 2024...
Square Enix didn't release it that way for mere preservation reasons. The way they released wasn't even representative of it in its own time, so it wasn't even achieving that anyway.
The reason they released it that way was because almost all of the original assets were lost. There was a story that came out years and years ago showing the very few original assets that did survive. Otherwise, all that remained was the assets of the original shipped game, and those were all 320 x 224/240 to fit onto the CD media the PlayStation used. The original assets are such a low resolution that they already look bad at 640 x 480, and it obviously only looks worse on the higher, wider resolutions of today.
So to play it without ruining the look any, you'd have to play at... 320 x 240 or so.
For reference, ignoring the enhanced 3D and focusing on the 2D parts, If you just upscale the original assets using a nearest neighbor approach (but keep it in its original aspect ratio), you get something like this...
It's pixelated. It doesn't look good at all since such a look isn't what the game was going for.
So Square Enix filtered it...
They probably figured that is more presentable to most people than the first, and they're not entirely wrong, even if it still looks bad.
I don't entirely blame Square Enix for this. They actually did the best they could with what they had at the time (well, short of manually recreating the 2D assets in higher resolution anyway, at which point they may as well consider going further and remaking the game, and while I'd obviously have preferred that, what they did was the better than nothing and it did make it available on the PC natively).
As a bonus, here's an attempt to make it look like a bit closer to how it would have in its original format on a CRT, but on a higher resolution LCD. It's far from a perfect replication, but it's at least better than the above two in my mind. This is achievable via modern emulation filters.
What the Moguri Mod does is a combination of AI upscaling and manual touch ups to the PC assets (and it probably used some of those surviving original assets as its source), plus widescreen support where it can. Remember, machine learning and AI upscaling weren't really things in the years before it was ported to mobile or PC so it's not really fair to criticize them for not doing that back then, and I'd argue that's still not an entirely proper method. This is all simply something that happened because changing tech (low resolution CRTs to widescreen LCDs), and nothing short of a pretty extensive remaster involving manually recreated assets (not just upscaled and filtered), or a full on remake, would have done it justice. Which, hopefully we get that one day...
If anybody is wanting to play ff9, please play it with the moguri mod... i wish square enix would have done a better job with the pc port...
While I do think that is the "most presentable" for "the general populace" insofar as visuals, since most people probably prefer a sharper, more detailed look, I still prefer the original version because something about it that looks off to me. It has a bit of a "painted filtered" look, and that's also not quite the look the original game was going for. It might be because I've known the original game from the start. Don't get me wrong, the people who worked on the Moguri mod did a great job and I acknowledge it's the most presentable version for most people, but that's not me.
note : there are some cgi screen to game that the mod couldnt upscale, especially in the early part where VIVI falls down and the girl picks up the ticker for him
Ah, that's interesting that it doesn't/can't upscale those.
The PlayStation had a neat but rarely used feature in that it was able to overlay 3D onto an FMV of sorts. Final Fantasy IX did this in a few spots, and the one you mentioned is one of them. When Zidane is running in front of the Iifa Tree the first time you see it at Conde Petie is another time it occurs.
The one in Alexandria immediately follows another FMV, so maybe they felt it would add immersion to do that as a transition between the prior FMV and the first part of gameplay in Alexandria.
It also might have been for technical reasons. That moment shows a lot of NPCs walking along the street, and it may have been more than the PlayStation could handle normally, but they probably wanted to show that many at that time to help establish from the start that the world is alive.