This is wishful thinking, folks. I do believe Shenmue III will be at PSX, probably HD as well, but to expect gameplay is a bit far fetched. I base my prediction on Yu's statement of ramping up promotion near the year's end and PSX is the only stage capable of doing so, or maybe The Game Awards, but the former has the best shot.
People think Sony fired their heaviest guns at Paris, but I disagree. They still haven't shown Shenmue III, Resident Evil 2 REmake, FFVII, Dreams, Days Gone or other hits they have lined up.
At best we will get a nicely done cinematic trailer, but gameplay still has to be too early to show in my book.
I disagree with some of your PSX predictions. I went there last year hoping for it and was disappointed on that front, and based on my conversation with Gio back then I no longer expect them to do promotion at a trade show unless it's announced ahead of time. To my point, they did tell us about Gamecom in advance. There will be no Shenmue 3 at PSX unless they announce in advance that it or Yu Suzuki will be there. The interviews at Gamescom specifically told us they don't plan to show anything new until the end of the year at the earliest. (Not exact wording because this is from memory) Since 1 & 2 are in Sega's hands, those are still fair game for a surprise announcement, but at the moment it actually seems unlikely to me because the only re-releases of old games they've been doing recently are mobile. I don't think Sega Heritage Collection actually worked out for them, because they seemed to abandon the series after SA2 / NiGHTS / Jet Set Radio several years back.
I do agree that they likely have a good number of titles left to announce/promote at PSX though. Probably Death Stranding unless that's at the Game Awards first, but not FF7 specifically because SquareEnix said it's still a couple years off due to development being shifted in-house. They'll probably show Kingdom Hearts 3 instead, since that's due next year. As far as surprises go, I know Tetsuya Mizaguchi has been working on an unannounced VR game in the year+ since Rez Infinite came out, and I'm hoping they reveal that soon since Rez Infinite was first shown at PSX 2015.
They haven't even announced any developers or guests that will be at PSX yet, other than the return of the collectible cards. The cards are actually a hint at 3 games that will be playable though, since you got them last year for playing the respective games. (Meaning Destiny 2, Moss, and Shadow of the Colossus will be playable) I suspect they'll start announcing booths & guests next week once Paris Games week is out of the way.