That looks insanely odd.
They've found ways of making them look a little better since that vid was made, but it still isn't perfect.
The problem is that they were able to backport the models, but they had to use them with different characters' animations (I don't think they've reverse engineered the animation system yet), hence everything in the wrong place.
The same thing happens when models are swapped in FF7, if people don't move all the parts into the right place.
