Exactly what Ouch! said. Look at the age differences. Selphie is a child while Squall is all grown up... how could that happen if the events of FFVIII happened? Tidus and Wakka are together even though in FFX they dont meet until they're grown. In FFX, Wakka at that age would be growing up with Chappu, Yuna, and Lulu.

Aerith is alive, and she comes from a world with Cloud, Cid, Yuffie, and Squall. Cloud is a sort of hybrid of himself and Vincent. All of these things make no sense if put in context of the FFVII and FFVIII worlds.

KH is its own universe, and the FF characters that exist there are part of the KH storyline, not their individual FF worlds.