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I'd say minus Cloud Yuffie is the best character in the game fighting wise. As for her character while she wasn't really involved in the main plot- why she stayed around to defeat Sephiroth never addressed other than the fact she wanted Cloud's materia- she was a great character. I think people either remember the part in Wutai where she steals your materia or the fact she's young and call her annoying without much reason really.
I don't like Cait Sith because I just don't think it makes any sense at all. So it's meant to be a talking cat on a robot moggle right? Why doesn't that seem strange to anybody? About Red XIII they are all like "OMG, IT SPEAKS!" but when face to face with Cait, nobody batters an eye lid. Also why did Reeves use a robot cat..... to control a robot moggle anyway? I'd have much preferred it if Cait Sith looked human but was actually an android.
Lastly how did he manage to get away using Cait without anybody else in Shinra noticing? I understand at first it was part of Shinra's plot to use Cait as a spy, but that plan should have finished at the Temple of the Ancients. How he was allowed to continue to use it without them knowing was remarkable. At one point Reeves manages to have two simultaneous conversations with Scarlet & Heidnegger and Cloud and co. And then after he is arrested by Shinra he STILL manages to control Cait! Crazy.
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Yeah, Yuffie gets a bad rap by some people. She gets called annoying for stealing your materia, but that was probably the most thorough and entertaining sidequests in the game.