On this topic, I am conflicted.
On the one hand, XIII set up a few threads that were really not resolved and there's a few interesting directions they could choose to go in. And I did have a good deal of fun with the game.
On the other hand, I'm not sure I'd like to see those being resolved with in another FF XIII as it was my line of thought that it'd end up in the other FFXIII's that were being developed. And I'm not sure I'd cal FF XIII an especially great game that I'd be all too happy about getting into again.
As for the whole medieval thing: Keep in mind that the Fal'Cie of Cocoon were the real source of technology, as well as the power source for said technology. The humans were just mooching off it. Pulse was a bit more natural. With Cocoon gone, technology would go back to the dark ages. The whole costume change seems closer to the apparel of Vanille and Fang than Snow or Hope.
And so forth.