The only point I'll respond to as of now is the objection to the Jenova point I brought up about reading the minds of people she already killed and took the form of, and the Masamune being forged out of spirit energy -
Ifalna says Jenova used the shape of dead loved ones to approach Ancients - she does not say she did not say when she did it or to what extent, so that objection is based on an assumption.
For all we know, when the meteor first landed, one or several ancients would have approached the crater to investigate, get killed and "absorbed" (for the lack of a better word) by the Jenova organism, laying the foundation for her first shape shifts into dead loved ones.
There is nothing about Jenova taking the shape of dead loved ones that requires her to be able to read the minds of still living foreign bodies - all she would need is to kill and take the memories of one person with a shared relative - and Ifalna's sentence does nothing at all to rule this out, nor is it specific enough to prove the opposite either, as it makes no mention of telepathy, extent, scope or nature of what Jenova is doing.
Ifalna being able to listen to the voices of the planet does not make her omnipotent, and based on what we do know (like for instance, that the amount of information in the life-stream is so vast that being over-exposed to it is dangerous) clearly indicates that whatever you do get out of the planet is sporadic and disjointed - so to assume that Ifalna is speaking from some sort of authority on Jenova, rather than bits and pieces of sporadic information is not warranted.
Jenova is never shown in the original game to be reading minds outside of her direct physical influence, nor is it necessary to explain the plot, hence why I think it's a unnecessary addition that only further deepens the extent of convolution in the story - as is apparent when talking about Cloud shaping his persona based on Tifa's memories rather than Zack's.
Saying Cloud didn't need those memories when he was with Zack, presupposes he would need them when he met Tifa, but as I've already pointed out, the persona Cloud eventually did end up shaping makes very little sense if we're to believe that it was a result of Jenova's/Sephiroth's machinations more so than his earlier innate personal disposition.
Furthermore, if Jenova, more so than directly influencing this, simply reacts to her surroundings and absorbs memories etc. I see no reason why the cells wouldn't have been hard at work already when with Zack.
Point remains though, that as shaky as Cloud's persona is, if Jenova cells are hard at work reading minds and feeding him information to bolster his delusion, why isn't Cloud's delusion more well-designed? After all, Cloud moves past, and interacts with many people in the Shinra organization after meeting Tifa, yet before relating his story in Calm, such as Rufus, members of the Turks etc. all people who'd have valuable information on the structure of Soldier etc. who presumably, if Jenova had read their minds as well, would help Cloud build an even more comprehensive persona for which to bury his trauma.
Asking us to believe that the Jenova cells conveniently only read minds when Cloud needs them to in order to bury his personal issues would (yet only does so selectively for no apparent reason), to my mind, be another indicator of bad writing - although I'm prepared to accept that might be the official explanation for my objection on this matter though.
I'll say it again - more likely this is simply a after-the-fact insertion of world-lore in order to address something they didn't think of the first time around.
Can we "make sense of it" now? Sure - but it's exercise that only demonstrates the issue with the plot to begin with, when you have to go to such lengths to do it, and when it obviously isn't clear to the majority of people unless they've read guide-books and discussed the topic to death on fan-forums.
It's made even more apparent when the actual explanations people come up with are floaty and weird as hell even if they might be considered consistent with canon.
As for Masamune being shaped by spirit energy -
Again, this might be reconciled with AC material, but also again, this just further demonstrates my point.
If you have to allude to material created many years after the original, that were neither planned for nor envisioned when the original was first written and made to explain a phenomenon in the original, that is the very definition of bad writing.
In no other part of the original do we see anyone, Jenova included, shaping physical objects out of spirit energy - organic matter perhaps, although this is done by the planet itself, not any one being - but not steel.
We're really supposed to believe that Jenova just "magics" Masamune replicas into existence - not just for a partial amount of time, or as an illusion of the mind, or as a spell, but an actual physical copy that retains its presence in the world after she's left it behind and moved on?
Is it a plot-point that can be "explained"(see : rationalized) through some sort of convoluted tortured reasoning? Perhaps. In doing so, that in no way lessens the point I'm making here though - that is not a sign of quality writing by any standard or stretch of the imagination.
It should not be up to the audience, or later products to explain prominent aspects of story or lore in a piece of fiction, and such story or lore should not be so loose and willy-nilly to the point that these things occur to begin with.
Again, Occam's razor and all that - the more likely explanation is that the authors didn't pick it up the first time around. Sephiroth's iconic sword is an important part in establishing his character, and building into the illusion that the player is chasing the real Sephiroth rather than Jenova. In their desire to do this, and do it with gusto, they simply didn't think that far ahead (if they'd even really planned that far ahead in the plot when they first wrote those scenes, despite what else they might claim at later dates).