I think you only put FFVII this far down for the sake of controversy and discussion. I don't say this as if it's impossible for it to be this low, but rather because if you put as much thought into the reasoning for it being that low on the list into other games, you'd probably have good reason to drop them, too.

Balanced characters being very similar in style isn't great, but it's far better than having three or four characters that are clearly better than the others to the point that using the others is pointless. Likewise, I like that I can use any character in FFVII according to who I enjoy in the story instead of who is the most useful in battle. Again, I'd prefer a perfect balance of more varied jobs, but I'll take what I can get in this case because it's still better than most other FF's.

I don't think Sephiroth was ever really overshadowed by Shinra. I think he was always clearly the big bad guy in the game and Shinra, to coin a famous phrase from around this site, 'get in the way'. Also, far better to have two clear enemies throughout the game than to have the final boss sprung on you very late in the game like many other FF's do (here's looking at you, VIII/X/XII/XIII/possibly more I haven't beaten).