I'd have to disagree here. Yes, he did alot of terrible things, much are almost unspeakable, not to mention the lives he did take, but, in regards to the "what if" of getting his sanity back, I think, with time, he could be given a second chance. Something like this would be very touchy and highly tension-filled, but, perhaps with some work, it can be done. Alot of you may probably flack me for this xD, but I'm viewing this in a perspective of whether or not he could be blamed for his insanity, even if this is on a rather large scale. The negative aspect of the damage he did cause does obviously outweigh his redemption, but I still don't think it's impossible.
In Cloud's perspective, AC/C speaking, it seems to me he doesn't actually hate Sephiroth at this point, but moreso is just still angry at him as he still seems to show signs in AC/C of progressively moving beyond it step by step. Imho, I would think Cloud would have an inner conflict about it for some time, but may actually try to make the effort to give him a benefit of a doubt, depending on Seph's behaviors and clear intents. Personally, Cloud never really came off to me as someone who would hold a deep grudge and never let go of it, but that's me. Either way, it would still take him some time to slowly ease out of it.
Tifa on the other hand, actually seems to be the more hateful one and, with her type of personality, she'd likely hold her hatred very deep and may not let go of it, imho. As in Last Order (tho not entirely canonically correct) she clearly showed her deep hatred towards him in regards of his destruction of Nibelheim and moreso for her father. It seems apparent in some places of FFVII as well that this hatred remains to be deeply rooted, likely in AC/C as well. She would most likely respond rather negatively to his redemptive presence and may even openly show her disdain and coldness to him, though inside, she may likely still fear him, due to his strong presence itself.
The rest of Avalanche may respond towards negative means in this sense, mainly regarding Aerith's death and the destruction he left on the planet. As for Vincent, imho, he may actually remain indifferent on the matter, while still alert to his presence. The matter of Sephiroth's redemptive presence would possibly go deeper for him, but not for the same reasons, rather, because of the OWA's relation to Lucrecia. While the ex-Turk may have shown some disdain towards him, it may not be nearly as hostile for he did not seem to show any type of hatred to him in FFVII, but perhaps mainly for the matter of just being a threat in himself to the planet. Vincent would likely not expose his reasons but would, as I mentioned, probably remain indifferent.
Regardless, the matter of redemption would obviously be a very long and hard road to travel, likely meeting alot of negativity to his presence alone, but whether or not they would take into consideration his insanity at the time, would entirely be up to them. This is basically what I think on the matter.
~ SoS
