You are correct in your assumption... how can Level 2 be switched to if a Level 2 break hasn't been learned.

Are you sure you're making sure to use her LIMIT as often as possible? I once had a circumstance in which I couldn't get Cloud to learn Clim Hazzard even though he'd already gained Meteorain and Finishing Touch. Not having that one LIMIT made it impossible for me to get Omnislash and the bastard just wouldn't learn that damn Clim Hazzard.

Are you sure you've used Tifa to individually kill a total of 96 enemies? Maybe while using her LIMIT, multiple enemies are counted as one, you ever figure that? Not that I honestly know.