To expand on my point; the line both makes no sense, and makes perfect sense at the same time to me.

I understand that Cloud's basically saying that he has no idea who Reno is, but the fact that Reno doesn't know Cloud either seems irrelevant. The way the scene takes place sugests that Cloud was about to say something like "I don't know who you are, but you got about five seconds to **** off!" like he was basically saying, either get out, or prepare for a fight, but then he suddenly ends it with "you don't know me" in a manner that seemed really forced, and then the borderless voice says "I know you!" (this is before we learn who the voice is) it is a very strange scene.