Good or bad?
I personally think it's bad, but it's the price we pay for getting better graphics in our games. Each 3D model would be incredibly difficult to make and take ages to do, but recolours can take 1/5 of that. I was almost considering using palette switching for my own game, which is a side-view system and since it is quite hard to find monsters for those systems, I have to make them myself. But I've decided quality over speed.
All FF's above and including FFX had this feature. Even off my head, I can name over 10 in the three that have been reused.
So, what does everyone think?