I still think the point that renders the above discussion a bit moot, is the fact that the sword itself, modified or not, does not necessarily present any threat to Cloud's new narrative, so I think it would be a rather contrived point to add to the plot.
If Cloud's soldier uniform does not present meaningful cognitive dissonance, I see no reason why the unmodified Buster Sword should present one either.
I simply don't see why it would be necessary for him to cover up "the true nature" of the sword. If he could eliminate Zack from his conscious memory, then by extension, that would mean that he would have eliminated the heritage of the sword by extension, which essentially means that looking it at should mean nothing more to him than looking upon Nibelheim, or places he's been in Midgar should mean anything to him.
Whether he forgot about it, or whether he repressed it, or whether it's believable that he could do so such a thing, is secondary to the glaringly obvious issue of why he would have to do so in the first place granted everything else happening in the story, and whether or not adding this adds anything to the quality of the writing of the story.
As I've said in many other threads already - FFVII's plot is like a Swiss cheese, filled with holes, logical breaks, and nonsensical narrative points. And if anything, the compilation only made it worse.
In going through this remake, they have an excellent opportunity for brushing up the plot, but the best way to start off doing this is shaving off unnecessary plot contrivances that don't need to be there to begin with, and whose presence threaten the cohesiveness and believability of the plot.
Adding another thing to explain - the sword modification, if indeed that's what this is - is not served by jotting it down to Cloud's mental issues, trauma or Mako poisoning non-withstanding.
It's bad writing plain and simple (unless, as we've all pretty much agreed on, it's presented as a conscious choice to demonstrate Cloud's transition into a mercenary).
That being said - the same people who wrote the mess that is the compilation's storyline, is the same people writing this, so it wouldn't surprise me at all, if this plot-point is made even more complex and contrived than it needs to be, or what we've considered thus far.
RANT :
disclaimer - I'm not jumping on FFVII's story as a whole though. I still love the story, and think it's a great story in general, in its broad strokes. But, it needs to be said that the original game was campy as hell, probably on purpose, where more attention was paid to making it an interesting experience than on making it a high-level coherent narrative.
This has been made worse over time, as devs and writers have gone back to the world several times to add to it and flesh it out with what appears to be a completely different mind-set and conception of the world than what was there when it was first made.
Now, though, we have multiple source texts published by the IP holder in which the writer of the game is credited as providing editorial supervision and collaboration, explaining to us what went down from an in-universe perspective.
Point in case - Essentially, what I think this should say is :
telling us what they now, several years later, rationalize should have happened based on what they now think about the game after having been forced to deal with the plot again and again in order to create these guides, novels and compilation titles.
I don't think we should hold any illusions about the game being thought out in the way that many of these later titles "clarify" given the fact that most of these points could easily have been clarified in the original title had they in fact been conceived of at the time they were making it, not years after its original release.
This is not a dismissal however, of the "canon state" of the information provided by these release - rather it's just me pointing out that a lot of this information being canon does not save it from being nonsensical or contradictory with the original narrative.
In fact, the act of adding to canon so much time later after the context of the original development has changed, along with the memories, hearts and minds of its creators, the plot becomes gradually more contrived and nonsensical as fans have to further and further suspend their disbelief and rationalize the changes/additions that have been enforced over the years, making FFVII gradually more and more difficult to actually make meaningful sense of.
The original FFVII's plot is a thing that gained from not being fleshed out - not having everything spelled out - simply because the original plot was messy enough as it was.
The "clarifications" just messed it up even further, because it was written to flesh out or cover issues where really good clarification probably won't be forthcoming to begin with no matter how hard you try.
Keeping things vague, and allowing fans their "head-canon", or simply glossing over it with 90's anime charm, is the saving grace of FFVII's plot, and most of the additions they've made since the release only mess about with this.
That's the biggest reason they should avoid adding more stuff Cloud did unconsciously to cover up his real identity like the plague. It does not help the plot in any way what so ever.