This sums it up for me, in regards to the story. Not that complex and dark are pre-requisites for a great story, just that Xenogears did it very well.
http://www.siliconera.com/2010/06/11/soraya-saga-on-xenogears-and-xenosaga/
a: I and Tetsuya Takahashi originally submitted it as a script idea for Final Fantasy VII. While we were told that it was too dark and complicated for a fantasy, the boss was kind enough to give Takahashi a chance to launch a new project. Then Takahashi and I wrote up the full screenplay which contained cutscene-dialogues in final form, thus the project was born.
The works of Nietzsche, Freud and Jung happened to be part of common interests I shared with Takahashi. Xenogears is basically a story about "where do we come from, what are we, where are we going". In that respect, we were inspired by those concepts a lot.
