I never believed Squall and Seifer to be mortal enemies. Their rivalry is certainly undeniable, but I never got the feeling that either truly hated one another. Squall and Seifer understood each other (at least to an extent), and they certainly respected each other, despite the crap they might dish out. I felt like Seifer was the only one who ever really could empathize with Squall (although he never seemed to care to). I don't think that means there was any romantic involvement between the two--that really is just yaoi fangirl stuff.