I'll try to clear it up.
The topic at hand is: GDC look at FFXIII
The image below the subject is of FFXIII.
Then you have the text: "So for the first time a Square Enix game won't be using its own "from the groung up" graphics engine? Well I cant think of a prettier engine than UE3 for The last Remnant, looks like itll be a $$ saver for them to use Epic's engine."
So we're particularly discussing FFXIII here, not The Last Remnant.
So to put it right, FFXIII will be using the Crystal Tools, which are in-house tools created by Square. They will not be licensing this engine out because they don't want to have to support it. Although, they said later on (possibly after FFXIII is out), they may consider licensing the tools.
The part that mentions The Lost Remnant in that article is just saying that Enix will be using UE3 for that game, and not any in-house tools.
Back to the original text in your first post...
"So for the first time a Square Enix game won't be using its own "from the groung up" graphics engine?
That is incorrect. They will still be using their own ground-up engine.
