Anyway, Brad, so that we can come back to the theme of this thread (Should Remake be different?), the old Privateer used a sprite engine because computers could not afford to render 3D meshes. Now they can, and it's quite logical to take advantage of it. And you don't even have to sacrifice the look of the original game while taking advantage of modern graphics.
And, another very important drawback of sprite engines: VERY POOR COLLISION DETECTION. And that is really important in a game where you'll have to dogfight in space. (To avoid misunderstandings, although a sprite engine would handle collisions very efficiently, it would be very unprecise - sprites can only assume uniform, coarse 3D shapes, but not describe them very well individually, so you end up, collision-wise, having sphere, ellipsoid or box-shaped ships, and that's bad). And you'll never get rid of the disparity between what you see the shape of a ship is and what the computer thinks it is. The big problem would arise with sprite bases, mainly, if you try to fly close to them.
If you want the look of a 100k mesh into an 8k model, you can use some (freely available) tools than can render the textures for an 8k model so that they look like a 100k model. That is, they render the details (creating a normal map, for instance) into the textures you will use with the 8k model. That way, the texturing does all the work. It's kind of an advanced form of sprites, if you think at it with good intentions.
What I mean: you don't need a sprite engine to be able to include prerendered detail. The 3D mesh engine already has all you need to do it without sprites, and without their drawbacks.
The point is that making an 8k model look as good as a 100k model depends on wise texturing. And, it can be done, with wise texturing. There are only a few impossible tasks, like modelling complex antennae or wiry things the likes of it. And you can use sprites only there, where they're needed. Nothing stops you from doing it.
Hell, if you want to have real 100k ships without performance problems, either use a lot of lod levels, or use nurbs. Again, perhaps vegastrike doesn't support nurbs, but at least if you model with nurbs you can automatically generate lod levels, and when nurbs are incorporated into vegastrike you already have the models. With enough lod management the scene would never have so huge a poly count as to make a modern GPU stall. How in hell would you put 10 full-screen ships in one screen, without colliding with each other?
Finally, a sprite egine would be a retro solution, which perphaps would be nice to create the feel of a retro game, but totally unnecesary. You can have the same effect with careful stylistic choices, and avoid all the drawbacks of the sprite engine.
And my thread-related opinion: the only aspect worth retaining in the remake as close as the original as possible (with one single exception, but nobody seems to agree with me - see the thread about dynamic economy), is gameplay. Change all you want, as long as it is to make it better. But don't change gameplay. Privateer was not about graphics. It was not about space combat either (although it had an important role). I could never find a category. For me, it was Privateer. There were RPGs, there were FPS, and there was Privateer. So, gameplay should not change. And right now, gameplay is quite close to the original (save a few bugs and some balance issues).