I've been reading around and hearing what you're saying KAB. A lot of fans are sad it's not a continuation of Defiance. But you know what? Defiance actually ended on a good note and a satisfactory fitful ending. It came full circle linking Raziel's fate with the Soul Reaver and fully turning Kain BACK into an anti-hero who finally came around to embrace his destiny as the Scion of Balance after the breaking the endless "Wheel" led by some creatures like the Elder God.
It did leave on an open note because of the open storyline with the Hylden but I felt satisfied.
I think with its acquirement by Square Enix, Square is trying to make its mark with its Western publisher/developer by revitalizing its franchises. First with Tomb Raider.
Legacy of Kain has always had sort of a "cult" following of fans for the storyline. But the whole time travel element really mixed things up in some circumstances, especially when you consider some of the character issues with Blood Omen 2 (i.e.: Wasn't Vorador DEAD?).
A reboot gives it a fresh start and introduction to a new fanbase without being muddled by the history of the other games and the perplexed look of some other gamers who might be like "what is this game?". Plus, if they get some good writers, they can outline for a much more coherent storyline with all the time travel and destiny elements.
I say do a reboot! If it's awesome, then hopefully a sequel and a release of some of the Legacy of Kain games on HD!!!