I don't think they were referring to the suggestion as power creeping, but the notion that the ilvl keeps raising is power creeping. Or at least that was what I was referring to.
The ilvl is their way of assessing the value of the item, while two different items with the same ilvl can have different stats. Take a look at Coil items to AF items.

Yoshi did mention somewhere in either a Q&A or Letter from Producer somewhere that the crafted gear comes close to being just as good as dropped gear when overloaded with materia (that is slotted to 5 maximizing the stats it can have).
However, each item at a certain ilvl has limit on the max stats for that item. And I don't think you can have a higher stat from a crafted lower ilvl to be higher than higher ilvl. You can have more diversity though with crafted gear.