People need to not assume just because they haven't heard anything for awhile that a game is cancelled. Atlus tends to take awhile when developing theirs, and is typically very hush hush during most of development. No surprises there. It'll happen.

1-Cancelled;
There have been numerous rumours and sources stating this game has been cancelled and with no info about it for ages it gets more believable with each passing direct. BUT sometime ago Nintendo said development is still going.

2-Priorities;
Atlus and Intelligent Systems have both been busy lately. IS has done one Fire Emblem, Codename STEAM and now another Fire Emblem (although re use of assets will cut dev time), while Atlus have been working on Etrian games and Persona 5. So perhaps SMTxFire Emblem is a secondary project.

Either way I hope it is still being made.

I really hope that this titles makes an appearance this year. Atlus has been one of my favorite publishers going back to my childhood and Thousand Arms. Btw wtf ever happened to the Arms franchise, that was one of my favorites :(

Didn't Dragon Crown went though something similar to this?

Anyways, I still believe that the game was announced way too early. They reused a bunch of existing art in the trailer and the game title looked like something they put together in 15 min.

Two developers that take forever with their games crossing over. This kind of wait is what I figured would happen, but it'll be worth it. Atlus knows what they're doing, Intelligent systems knows what they're doing. It's still torture waiting though. Oh well, it'll be amazing to finally see the original smt protags be brought back.