That's not true at all. Games like Zelda were absolutely possible on the N64 and close to traditional RPGs. The only thing that wasn't really realistic was to make extensive use of pre-rendered background stills like in Final Fantasy (due to relatively large file sizes), or pre-rendered FMV (due to massive file sizes).

But neither of those things were in any way required to make an RPG. In fact, heavily relying in pre-rendered stuff has mostly been abandoned since.