The entire party reflected on her death at the end of Disc 1. They resolved to continue on with their journey. It's not like they immediately went snowboarding the instant Aerith died. The game had a clear transition. I also thought the Great Glacier was an incredibly well-done section. Scaling up a giant mountain, fighting enemies for over an hour, only to get to the top and lose both your leader (Cloud) and the Black Materia at the end.
The party stops Shinra from getting the Huge Materia because they are still an antagonist. And they have confidence in themselves to stop both Sephiroth in Meteor without Shinra's help. Even if you fail in collecting any of the Huge Materia, Shinra's rocket fails regardless.
It's natural that they would be disappointed about the rocket failing to destroy Meteor. Even though Shinra is their enemy, Meteor's destruction is a mutual goal for them.





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