To me, it just feels like a screeching halt to the plot. You finally escape Midgar after x amount of hours (and depending on how much you know about the game, it can be lots and lots of hours) in the whole ass smurfing world, on the lam from Shin-Ra, searching for Sephiroth.

Then you take a break immediately to do an hour long cutscene where you can't even just spam X because have to move around and stuff. It's fine the first time or two, but afterwards becomes SUCH a chore. I think it would work much better narratively if it had come after the Mythril Mine. You see the Zolom that Sephiroth destroys, and it has given you a chance to explore the world some. Given that nothing really happens again until Junon (Fort Condor, but again--unless you know what's going on, Fort Condor seems really stupid and pointless) and MM itself is sort of a bore besides the 5 minute cutscene with the Turks, it just would have made more sense there.

IMO.