ONE Thing that I would have made different in any Final Fantasy

[Sephiroth]

That has nothing to do with selective memories, I know the intended context and when something was unequivocally meant to be, or as Tetsuya Nomura said "the answers lie within the game", it was a nice try though. While having gaps in the confrontation within the reactor as those are in his subconsciousness with the rest of the truth he did not need, Cloud's confabulation was never explained to be absolutely inaccurate when it comes to of which elements it consists in total detail, so the half-truth is without any big problems about Zack and Sephiroth fighting a dragon while Cloud is all sick in the back of the truck and no matter how strong Zack was compared to Cloud, he still was nothing against Sephiroth - which is a fact and no mere sentence from a Sephiroth fan, it has been shown multiple times. And Cloud was all "I'm an Ex SOLDIER" so he did very well think about his boss-like skills as SOLDIERs are incomparable and only a few are promoted to rank 1. Still he had a healthy respect for Sephiroth as he is just a different dimension of power that needs to be thought about.
You are talking about Cloud's expression of how weak he was compared to Sephiroth but that Zack might not have trouble with a dragon. Now imagine how powerful the dragon could have actually been. It was shown as pretty impossible to defeat by normal powers, just like the Midgardsormr (let's not go to the point where we all have still beaten it). Sephiroth's stats were not even relevant as he just took 0 damage to show how powerful he actually is, Zack's absolute glory was shown in his very own last battle and still the dragon topic is completely without meaning because it is a DBZ powerlevel case were no one knows how strong it actually is but very strong and Sephiroth couldn't care less. Is a dragon, a supernatural fairytale being stronger than an army? Normally yes but let's not go that far. Would Sephiroth have beaten that army? Yes, in fact Zack almost did. And still claiming he would also be the same kind of badass as Sephiroth who was all "I don't care that you are a dragon" (yes, he fought the Bahamuts, as said, the point is still that the super dragon was shown to have incredible powers) and it can be very well said that Zack has more trouble fighting such a thing than Sephiroth. Not LV1 like in general as I explain below, but still.
Just because Cloud, who first loses (or Zack), can later fight a few HP dragon in the game when he and his friends arrive in Nibelheim and wins, that does not mean the dragon was that weak when fighting Sephiroth who is all "you are too slow, train defeating enemies with one slash" when lecturing Zack. And it is simply not exaggerated, stats do not matter, yes. Still what they stand for, does matter. And Zack or Cloud where both no match for Sephiroth. Even with his superb training Zack was surpassed by Cloud because Cloud was chosen to get his "super powers" whenever Sephiroth shows his weakness of arrogance and threatens Cloud's precious like his mother, Tifa, Aerith and his friends. He was always said to be greater than in any stories and that is exactly how he was shown in the present as well. Something superhuman, with his will and abilities even greater than powers like that of Cloud, Zack, Aerith, Genesis or Angeal who really have nothing to be ashamed of. So to sum it up, Sephiroth will always be what he was supposed to be when he was written and no matter if Zack or Cloud fought a green dragon, the powers of Sephiroth were by far greater and it very well could have been the case for Zack to meet monsters that were problematic for him, even if not the "LV1 Zack" way. That is not meant. LV1 compared to Sephiroth still is not even exaggerated as the only "decent" fight he put up against Sephiroth was in Last Order. In Crisis Core Sephiroth was even less impressed. Actually he was never really "impressed", he even was totally in his avenger rush just thinking about how he wanted to find the Promised Land. So Zack, who was shown in DMW scenes fighting monsters that Sephiroth wiped the floor with could easily be compared to Zack fighting a dragon and having problems while he guards himself to not get burnt from the Flamethrower breath, Sephiroth leaves the truck and the party begins. He gets attacked, he is not impressed. He attacks after a teleport, teleports away from another attack, casts a Thundaga and the road is free. And it ends.

I will not make another discussion out of a thread that was not meant for it.