I think a lot of people seem to think that all games are developed in a matter of a few months to a year. That is simply not true for 'real' games. By 'real games' I mean games which have their own engines developed. For instance, EA pumped out a new F1 game every year for several years. Every single one of them used an old, out-dated engine (Physics and Graphics engines). (the very same ones the SCGT engines)
Now, when you look at a game which is being developed with its own engine, you see development takes significantly longer. For instance, UT2007 has been in development for several years (before UT2004 was release, IIRC) and it has an all-knew physics and graphic engine. (Yes, an FPS with a physics engine... sorta. :P )
Also, there is Will Wright's upcoming title "Spore." Spore has been in development since 2000. Nothing have been said about the engine itself, but seeing as how the game is completely unlike anything else out there, it probably has an all-new engine as well.
Both games have very large development teams and Very large producers backing them. To make a full game takes years of work. Fact is, most games out there run on someone else's game engines. The Unreal Engine has been used for dozens of FPS titles, as has the Half-Life engine. The ISI engines for several racing games, etc etc. Many of the 'games' that are released are no more than mods, really. (Most Unreal Engine based games are just mods in a standalone package, the EA F1 titles were basically poorly done mods, etc etc.)
LFS is it's own complete thing. It doesn't use another game's physics sound or graphics engine. Everything was made for LFS. That adds years to a game's development no matter how many coders you have.