I think a lot of us are missing the beauty of Sephiroth's character here. He wasn't your typical villain. He wasn't just like: "I need to become a God so I can become powerful. Why I want this power I do not know. Let's go kill some people." Sephiroth wasn't like that at all. In fact, I thought Sephiroth was more a victim than a villain. He was turned into the villain because of Hojo. It was because of what Hojo did to him that made him vulnerable to the villainry. He saw an easy way out of why he might have been the way he was and took it. Most of the time he thought he was in the right, doing the world a favor, rather than destroying it.

Sephiroth had more character than Kefka did in the fact that he didn't do a great number of evil things. I like to think that a part of what he used to be still remained inside of him and kept him from doing many more evil things with his power. As Kain_Highwind said, Hojo was the true villain. He did terrible things to everyone around him and set in motion almost every problem in that game.