Yeah, I do agree that FFVII could have really used something in addition to materia, or at least some greater restrictions on their use. As-is, there isn't a whole lot to distinguish between the characters and play style. I can do basically the exact same things with Cloud/Tifa/Cid (my usual party) as I can with Cloud/Yuffie/Red XIII. It only depends how to decide to use materia that matters.