If there was a game to turn into a novel or rather, a series of novels, FFVII would be it.
That said, there are aspects of the game that work in the game, but would be difficult to replicate in written form. I'm talking about things like the passage of time, fights, materia, dialog etc. A lot of game mechanics would have to be given plausible reasons as well.
The other thing to keep in mind is length. FFVII is a long game with lots of backstory ect. you would have to include to make it work, as well as lots of description. In games, this isn't as much of an issue because you play the game in bits at a time. In written form, it's possible to see how long a book is before you start reading it. Also, games are more about fighting then books are. I don't see how Safer Sephiroth would be as impressive in a book where you can't appreciate how long (or not) a fight with him would be or what his Supernova attack looks like. (How would you describe his wings anyway?)
There's also the suspension of reality that naturally comes with playing games that doesn't come as naturally will books. In FFVII, nobody really cares about things like Gold Saucer's architecture not being possible because it's a game, specifically Final Fantasy; nobody expects it to make physical sense anyway. The "science" behind the Jenova Project would be the same. In the game, we have a simplistic explanation for it, but that's okay because we don't expect it to make that much sense anyway. If it was in a novel, the science would have to be more concrete.
What would be great about having it as a novel would be seeing the story from everyone's point of view. FFVII is in third person by default, but in novel form, you could get a lot further into people's thoughts. (Aerith's thoughts about Zack, what Cloud is feeling when he is controlled by Sephiroth etc.
I guess what I'm trying to say is that while having a novel of FFVII would be nice, you'd have to deal with a lot of the mechanics that work with a game. A lot would depend on who the author is and how faithful they are staying to the spirit of the game.
After all that, if you are looking for novelizations of FFVII there are quite a few of them on the net. You might want to check them out to see how they approach the game. See mr_ite's post above.^^