All of the future Squall visited was technically a place he couldn't live in (What Laguna meant was that they should all have died of old age by then), but the party managed just fine in Ultimecias time. Because of that, your explanation that Squall died because he reached a time he couldn't live in is wrong, because everywhere we see in the future is such a time.

It seems far more likely that Squall either simply collapsed (and didn't die at all) due to exhaustion/loneliness/hopelessness etc.

Oh, and technically speaking, TC never completed, and was unravelling after Ultimecias death, so it isn't entirely accurate to say that all of time was one during the ending FMV bit there.