I don't really know why it's only a cult classic. I know I'm in a minority here but I really dislike Pixar films. It is against them that I compare films like Atlantis or Brother Bear. They're no masterpieces like Bambi or Secret of NIMH but they're the best this millennium has to offer, at least for me.
To answer Snik's question, remaking Land Before Time successfully is a huge task. First of all, NO composer would be able to best or even match Horner's soundtrack. Any kind of remake would have to strive to its level but it would always be a disappointment. Also, the animation should be close to Bluth's style. If it's computer animated, count me out...
The places for improvement (these are only details) would be voice acting. I personally prefer the cast of Journey of the Brave to the original (especially Petrie) and it would be interesting to see how they would replace the original cast. Perhaps a remake could focus the world more in detail: I mean that we saw few characters in the film. The cut domehead scene would have been a nice touch. Also, there could have been three or four landmarks along the way to the Valley. That would give the film a longer run time but I don't know if it would get too repetitive...
In the end, I can only come up with minor improvements to the film we have. I cannot see any way anyone would be able to capture its spirit like the original film did.