Great thread and I share many of the sentiments of the OP.
Final Fantasy 8 is still my favourite game of all time and I have been gaming since the 16bit era.
To me the game was a perfect combination of action, story, graphics and fun addictive gameplay. Not to mention the supperb soundtrack which is one of the best I've come across in any game.
If I had to say what my favourite thing about the game was I would say the junction system. Although initially I was puzzled by it, once I got the hang of it I really started enjoying the game.
I too compare every rpg game I play to this, though I realise we are unlikely ever going to go back to the same gaming mechanics of the earlier FF games. The other thing I loved was the fact that I had full control of all the characters and with the active time bar the battles were always fought at a high tempo.
The only games which come close to FF8 for me are MGS4 and infamous, even though they belong to different genres.