Quote Originally Posted by Tifa's Boobs View Post
The bigger mystery is how Nanaki reproduced if he was the last of his kind...
That was never said. Bugenhagen mentions Nanaki might find his partner and On the Way to a Smile (which was written afterwards, however) also mentions it.

Yes, life in general continued. The planet survived and so its "children". It is not just about humanity, it is all life. Life was able to remain, the Planet was able to win and so Sephiroth did not win.