All I can say is that Cloud is pretty fair in the game. I don't see anything broken about him. You can punish him pretty hard if you dodge his shit. Although if his shit hits you, it hurts. As for Sephiroth, bastard has range but once you get used to that he isn't much. Again, nothing broken.
Anyway, I think right now I'd rank magic users higher than the melee characters. I've been fighting VS CPU battles on the highest difficulty and they are hard as hell to beat for me, borderline impossible. Then again, the highest level difficulty CPU makes every character look broken. If there is a definition of theory fighting, that CPU is it. It "almost" never makes a damn mistake. Almost as if it reacts upon your inputs the moment you input commands. And if YOU fuck up, say goodbye. That CPU loves turning the table around in an instant off one of your mistakes.