I'm close to finishing Chapter 2 so here are my thoughts... MASSIVE spoilers ahead so don't click if you don't want to know about scenes that do NOT appear in the original game.
The graphics are too notch, as expected. The combat is VERY fun. It's nothing like Final Fantasy 15 or Kingdom Hearts. The way you move, the way you strike, the certain angles you need to be in to deal damage to certain enemies, it's all extremely fun. And you absolutely can't get away with just smashing attacks (except when fighting scrubs, obviously). You WILL have to use skills, limits and so on. The way you can control multiple characters is very well done also. They pretty much nailed it as far as the combat system goes.
As for the story, spoilers ahead as previously warned.
So, Shinra does indeed blow up the reactor in the remake. However, it also affects certain areas of the city and you actually get to go through and see the effects of the devastation caused. Something else that is extremely well showcased are the feelings of guilt (and potential regret) that Avalanche members feel, as they are not aware that it was Shinra who caused all the destruction. While it doesn't match the original game 1:1 at all, it's an extremely well done moment. And Barret actually acts like a leader to the group and not just a loudmouth idiot.
The dynamic between Barret and Cloud is great too. Barret has absolutely 0 trust in him at first and is extremely condescending, due to the fact that Cloud was in Soldier. However, you can slowly see the shift in the way Barret treats Cloud. Again, not a 1:1 copy of the original but very, very well done.
Also... Sephiroth DOES appear. Cloud actually gets to talk to him. Though it is not clear if it's the real Sephiroth or one of Cloud's visions. In my opinion though, Sephiroth's voice felt awkward. I do not believe it's the same voice actor as Advent Children which actually sucks. Regardless of how bad the movie was, Sephiroth's voice actor was great.
The scene with Sephiroth doesn't add a whole lot... I'm not sure it was even necessary to include. It felt like a bit of a waste. If the goal was to show Sephiroth early on, it could've been done way better than this.
Even though I'm still at the start of the game, it's been very fun so far. My feelings might change as I progress through but so far, the game is good. Not ready to call it great yet, not even close, but it's definitely good.