There was an RPG I played way back when on the PS1 called Granstream Saga that I remember thoroughly enjoying, although I'm not sure how well it would hold up now... can't recall much about it.
Sadly it is not. Otherwise I'd make my first ever PSN purchase.
Vagrant Story is the best PS1 game. Depending on how you feel about Metal Gear Solid.
There, I said it.
Monkey Magic! It's a hot magic-wielding platformer.
Anyone ever play a fighting game called robopit? It was pretty fucking awesome. Sequel was terrible, but the original was great.
The Misadventures of Tron Bonne does NOT work on emulators properly, and this pisses me off to no end with the disc copies being obscenely expensive. I wish Capcom would just release it over PSN, but it probably doesn't run right on that emulator either.
Rising Zan and Silent Bomber are two really obscure actiony games I always remember. I didn't play a ton of Rising Zan, but I recall a lot of Japanese zaniness and weirdo bosses and an awesomely bad intro song they added for the western release. Silent Bomber is a super unique fast pace game that kind of combines Bomber Man with a SHMUP or something might be a way to describe it? I remember it had a cool lock-on system that let you pile bombs onto enemies, and elemental bombs you could stack to maker larger effects with a detonation. And the environments were hugely destructible for a PS1 game from what I recall.
I don't remember much about silent bomber, but I do remember enjoying it.
I don't have as fond of memories about Legend of Dragoon as some of the rest of you. I played the crap out of the game, and I liked the timing-based battle thing it had going on, but I remember almost nothing else about the game. I remember zero about the story, and the only other thing I can recall right now is that I spent a lot of time looking for Stardust or something of the sort. I don't even remember why.
I don't know if it would qualify as being 'under rated' but Valkyrie Profile was an awesome game, still is in my opinion. Grandia was a pretty damn good game too, if not a bit cliche, but that was part of what made it so enjoyable. Einhander was easily one of the most addictive and brutal games that I played as a kid, with great art direction and music to boot. The Ghost in the shell game where you play as a tachikoma was a blast, although i never owned it myself, only played it at a friend's house. I always felt Omega Boost was VASTLY under rated, having been from polyphony digital I always thought it would have gotten more press than it did, though i guess there is something to be said for releasing a sleeper hit. Though there are many more im sure i am forgetting about, the final game I can think of off the top of my head is digimon world 3 (let the laughter commence)
Basically, the bad guy is the last (or so he thinks) member of a race that was destroyed in a war several thousand years ago. They were wiped out by the humans thanks to the Dragoons, who were humans (and 1 Gigantos) in flying armor given to them thanks to help from dragons. Now the bad guy wants to wipe out the humans, so the game's heroes have to stop him and they find the dragon armor along the way to do so.
I'm definitely leaving out a lot of details, but that's the basic gist of the plot. It's no Final Fantasy, but it was still pretty great. Plus, as you said, the battle-system was a lot of fun. Aside from the bad typos and translations, the one thing that I really didn't like was the world map was essentially on rails. You couldn't actually explore the world map like you could in FF 7, 8, & 9, but were stuck walking on a set path that you could not deviate from.
I actually really enjoyed Crusader: No Remorse. I never had a memory card for my PS1 so I never beat it and never played past the third level. But those first three I played countless times and loved it.
I wasted a bunch of time on Azure Dreams when I was a poor college kid wishing I had a PS2 and something other than Ramen noodles to eat.
Team Buddies. The best game ever when playing with friends, alongside with Crash Team Racing.
I've still not played my copy of Devil Dice from when it was new. Should dig that up.