It's really hard to tell what would have done well. Panzer Dragoon Saga wasn't out until 98 but was as much of a tour de force as FF7. Sega Rally was the first driving game to have terrain based physics. Perhaps it would have taken off in the West. GT sold 10 million units so don't count out a humble racing game. 

Also if Saturn hadn't bombed in the west Konami, Capcom, and Core Design would have kept making games for it. Imagine N64 having to deal with another system that has MGS, Resident Evil, Castlevania, Tomb Raider Trilogy, etc. 

Finally if FF7 got ported to PC, it would have likely got a Saturn port too. 

I really can't stress enough how much retailers in the USA screwed over the Saturn. It was pretty much a Toys R Us exclusive system. The nearest store to me that even sold games was an hour away. By 1998 nobody carried Saturn stuff at all. 

Nah, you really don't believe Panzer (from a US commercial perspective) is on the lines of Final Fantasy.. do you?  Especially FF7?!!??  

There is no doubt retailer situation hurt, but there are so many others facts:

1) Sega had NO reputation by the time the Saturn launched.  They burned the crap out of people with the CD and 32x.  Both were just trash "upgrades" that alienated their core demographic.

2) Pricing, $400 for far too much for a system that was no more capable than the competition.  

3) I still maintain their game lineup was weak for the US.  A bunch of arcade games, not much else.  The world was moving on from arcades.  You compare Sega Rally to GT...  you do realize GT has an entire massive career mode with hundreds upon hundreds of cars, tons of customization, etc?  Which is my point.  Sega was launching Daytona and Rally, arcade ports.  Sony was moving to robust single player games with career modes.  Sega was behind massively on where gaming was going.  

Yeah not to shit on the Saturn, I have a soft spot for it myself, but even if they hadn't botched the retailer situation, it wouldn't have outsold the N64.

It lacked killer apps on the level of stuff like Mario 64, Ocarina of Time, Goldeneye 007, etc.

Panzer was on the same level of quality as FF7. Would it have done as well commercially? I don't know. Possibly. 

Didn't know there was as big a difference in career modes between Sega Rally and GT. Yeah it wouldn't have sold like crazy then. 

Saturn could outdo PS1 graphically but was hard to code for. Look at Power Slave and Panzer 2 for examples of graphics that outdid PS1. It also ran fighting games perfectly, which is something PS1 struggled with. 

But anyway to say that the Saturn is overrated is pretty shortsighted. The library holds up better than N64 and PS1 due to how well the 2D games have aged. 

Saturn is a good little system; I had one and enjoyed it.  I just don't see Panzer, in any situation, running with the commercial success of FF7.  FF7 was everywhere back in the day. 

The Saturn was more powerful, but like you said it was hard to develop for, which held it back and made the price difficult. 

As for what holds up better, that is a personal opinion.  I still have a few Saturn games, but nah I would take a N64 all day long.  Kart, Mario 64, Ocarina, Majora, Conker, Diddy, 007, Perfect Dark, Banjo, Star Fox, Paper Mario, etc.

Personal opinion, the ps1 slaughters both of them with the RE series, Castlevania, Final Fantasy, Chrono, Silent Hill, Crash, Vagrant, Tony Hawk, GT and MGS.

But those are my opinions.  I am probably that out man out with thinking the best Saturn game, by far, is Shining Force 3.    

edit

In defense of the Saturn my least favorite genres would be arcade, fighting and SHMUPS.  So for me the Saturn just didn't have a wide appeal.  I do think, could be wrong, my preference on gaming is quite a bit more mainstream than most Sega fans.  My 2 cents would be Sega makes excellent games, but most have limited appeal/commercial impact.   

I'll admit that Saturn didn't have an obvious killer app. PS1 does indeed crush Saturn, even today. There's so many JRPGs and 2D games on PS1 that are still a joy to play. For N64 I would say Zelda, Mario, Wrestling Games, Banjo, Conker and Starfox all stand the test of time. The rest of the N64 library is an acquired taste or simply outdated. Doubledash, Halo, and Melee all blow their N64 counterparts out of the water. I see GoldenEye as an FPS groundbreaker that Halo perfected. 

Quality vs quantity is an interesting argument to be had for both N64/PS1/Saturn and Xbox vs Dreamcast.

The N64 and Dreamcast don't have that many games compared to their competitors, but pack a lot of greatness into a relatively small library.

Xbox, thanks to its longer life, had more software overall than the Dreamcast, but for some the candle that burns brighter for a shorter span of time is more impressive than the one that burns longer but less intensely. 

Reminds me of the works spoke in the movie Blade Runner. Great flick.

Yeah that's the reference I was making, couldn't remember the exact wording, brilliant film in my opinion too.

"The light that burns twice as bright burns half as long" is a quote that is often attributed to Lao Tzu or the character Eldon Tyrell from the 1982 movie Blade Runner

Kudos Curl.