I'd say it is impossible to concider 1 of the 2 better then the other. Personally i loved the materia system but on the other hand i am messed up enough to be leveling squal and quistis to lvl 100 now even before getting ifrit. It really depends on what parts you would concider more important.
Both have a great story though the story in FF8 seems more realistic (as far as that is possible).
There is only 1 thing i liked more about 8. The characters. I prefer them to look real. I am not that big a fan of the super deform so in FF7 the battle sequences were a lot better then the normal game parts in terms of antomy.
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FF8 Vs. FF7
FF7 was voted the best FF in the series. Storyline is great if you can process it. Government corruption, cloning, betrayal, rivalry, and love all in one.