Sephiroth's sword was actually used by some warriors in feudal Japan. It was used to get people off their horses so it is possible to weild a sword of that size. Other than that, the nodachi wasn't used for fighting. It's like the claymore sword. The claymore was used for only the main charge into enemy forces and perhaps another swing. Then the fighter used a lighter weapon.
But since FF7 isn't reality, the nodachi is an awesome weapon, and Sephiroth is a god, it has to be the best weapon.