That depends on what people think of as a great game. A very fun game can surely be made on a low budget. That's what the GBA and DS games were--very fun. But an expansive, epic and grandiose game is extremely difficult to do under such conditions in the modern era, and that is what the "hype" around the 1999 game caused people to think of it as. There are many complaints about the DS games people have offered in the past (which I am far more lenient on, but I acknowledge they exist). These are things like "copy paste" level design and reused enemies--things like this can only be solved with larger team sizes and/or longer dev times--i.e. a bigger budget.
And on the 3D side, what if he was intending 1999 to be a 3D game? Would people have accepted something like the copy pasted hallways of LoI for their grandiose vision of what the 1999 game would be? I don't really think so. They would be let down and disillusioned, just as some would be let down if the 1999 game was "just another handheld entry."
Well firstly LOI wasn't really hallways, it was more like a series of boxes, I digress...
COD despite its lack of platforming still showed us the closest CV game with interconnected areas which was as close to 3D SOTN that we've ever had.
I'm not exactly sure why people would be letdown at a handheld entry, the handhelds were keeping the series alive at that point and on a whole they by far outshone the 3d games..
Perhaps people are correct that if Iga had more foresight he could've headed this "hype train" off and made the 1999 game quickly after AoS instead of Curse of Darkness or DoS. But would it really have been the game he wanted it to be with their budgets? I'm not so sure.
It could have been made as a DS or 3DS entry, but do you remember posts around CV communities in the past of people saying "why can't we have bigger castles? Why can't we have the 2D games as a console release like SotN? Why does it have to be on a small screen handheld?" etc. I'd wager there are a decent amount of people who would be disappointed by the 1999 game having just the production values of CoD or DoS only with greater plot significance.
That maybe so and I don't deride the notion of a bigger budget. However, realistically no matter how big the budget is games are generally a certain length of time. Bigger Castles are one thing, but more well designed, never done before castles (with new sprites, animations etc) would be more expensive as the devs have to do everything from scratch.
Let's say it was made as a DS/3DS game, realistically it wouldn't be a longer playthrough than about 8-10 hours, if it was a 3D console game it wouldn't play for longer than around 15-20 hours, that's just how long action platformers generally are... So the bigger Castle and longer playtime is kind of a dead argument, because developers generally won't make a game that's longer than it has to be. If they would, why not use those ideas and make another game? (Which is exactly what they did with the handheld series, which carried CV for years)
Based on what I've seen Konami also don't listen to their fans really, it's also really unlikely 2d CV was ever going to get a console release at that time, since the metroidvanias were aimed at a niche audience.
Judging from COD's ending I would say Iga was foreseeing a 3d game out of 1999, which I do agree couldn't have been made with an LOI or COD budget. However, did it have to be that epic? Sure it was the final showdown, but it could have been made into a decent 2d game. I think Iga was just awaiting a budget he'd never get to see. I often wonder why he haven't seen a SOTN reimagined in 3D, and in truth, I doubt konami would ever be able to make that game because the budget would never be high enough to sustain production.