Sephiroth's Legs: Gone.

[Luthien Rogue]

Camanche:

To me, I don't think the FMV should be taken so literally. If there is nothing below the torso, why would they make his hair sweep forward to cover his nether regions?

What're you talking about? His hair doesn't move at all during the FMV, go watch it again. The hair you see in the screnes Squall provided is behind his body.

I can see how it doesn't look like there's anything there period,

You can see hair where his lower body should be, meaning his lower body is gone.

but I'll just guess that this was Square hurrying things up, and deciding to not fully animate every part of Sephiroth's nekkid body when they can just "obscure" it in dark mako crystal, shadows and hair.

But they didn't. You have two solid objects, one right in front of the other: Layer one (the back layer) is Sephy's hair. Layer two (in front of Layer one) is where Sephy's lower body should be. Explain why you can see Layer one, but not Layer two?

The FMV's were groundbreaking at the time, yes, but not perfect. I think it was just a way to save time.

You say they animated his hair to flow in front of him and cover his... his lower anatomy. :P And used lighting and the Mako to hide it. How is animating his hair, using lighting and shadows, and adding more Mako going to save more time than creating Sephy with a lower body in a non-animated scene? o_O

Chocobilly:

My personal opinion is that Sephi had been in that materia soooo long that he was starting to degrade or something. Knowhatimean guys? I think that he may look like that because of his degredation process, but that wouldn't explain why his upper body is still intact..... hmm... maybe....

It's more likely that this happened when he fell into the Reactor. Mako would preserve his body.. and, as you said, it doesn't make sense that his entire lower body would deteriorate, while his entire upper body is in perfect condition.