You've got it all wrong, the story behind Aeris is completely ludacris, all-though, the cheese way to revive her is all true.
Everyone knows Aeris really didn't exist in the game, but she was actually Adlai Stevenson the entire time. He was mimicking ancient looks and rituals, and when Sephiroth found out who was masquerading around as Aeris, he killed Adlai because Adlai insulted the true Ancient blood-line. However, the White Materia that Adlai had from the ancient who adopted him fused Adlai's bones into something new and completely different upon his death, thus personifying a new creation known as the REAL AERIS. Now, considering that on their death, Holy crafted Adlai into his mimicked persona, wiping his memory and destroying any remnants left of Gogo, his alter-ego, when he sunk into the water, it actually sunk all the way down to a crevice that landed him in the life stream where he was tossed around. Finally, he ended up in the soil of Bone Village which is where the Cheese Shovel comes in, along with a Brown Chocobo, because both must dig at once to be able to get through the iron-soil layer about 50 feet into the ground.
About the Sephiroth getting, well everyone knows that once you get al 35 1/35 soldiers, you can goto the Gold Saucer's owner. He'll offer to buy them from you, but before you make a decision Red XIII will come in and say that Timmy, from the slums below, is trapped deep in the well! Go to the well, save Timmy, and low-and-behold, he knows of a completely new ruins that appears on the map when he is saved. Go there, and there will be 35 alters and a sword holder, for the masamune you can win at gold saucer. So, place the soldiers on the alters and sword in the hold, and leave. Now go kill the newly unlocked Beryl Weapon which will reside in the Snowlands. It has a whopping 450,000HP and 300,000MP and can cast the acclaimed Meteo and Ultima spells 3 times in one turn. You need to have you characters at level 99 and not have beaten Emerald or Ruby yet, because upon their deaths, Beryl will drawn strength from their ruined pieces. Anyways, once you beat Beryl, he'll drop "POWER SOURCE" take this back to the ruins, and put it on the little mechanical device in the back of the cavern and viola, your very own toy soldier.. What about Sephiroth? Who knows, I don't know how to get him.