I would debate about the Xenogears vs FFVII storyline however, I will refrain from it, considering I do like both games, more importantly, I don't want a Xenogears vs VII on a VII only thread.
As for other FF games being ridiculous, yes indeed that is true, Locke Cole + Offering+Genji-Glove with Atma Weapon+Valiant Knife ='s Most powerful damage dealing character in VI with 8xhits for 9999. You could also throw in other things like Gau during WoB, and in the Snes version the Vanish+X-Zone/Doom Combo was very infamous as well.
Or what about in VIII, if you don't count Selphies The End attack which kills everyone in the game instantly instead of undead monsters and Ultimecia then Zell is #1. He has the most overpowered limit break of all time, hands down! Switch between Booya and Heeldrop the whole time and if you get the beastly 10+ seconds? If your quick, you can do 90+ hits in one Limit Turn with him...9999x90+ hits...='s over 900k+ damage, you can actually do over 1 million if your fast enough. Even at 4 seconds you can dish out 40+ hits easily.
Or how about X with Yuna w/ Yojimbo with enough gil ='s Zanmato for Instant Kill. Wakka with Attack Reels for 12xhits for 99,999 and let's not forget Lulu's OD, if your quick, that's 10+ hits or more 90k+ damage.
I could go on and on seriously...
However if you want to know the tier listing lineup for the characters in VII, it goes like this...
Top Tier
Barret
Cid
Upper Tier
Yuffie
Cloud
Middle Tier
Tifa
RedXIII
Aeris
Low Tier
Caith Sith
Bottom Tier
Vincent
Barret and Cid - They deal out the most damage out of any character in the game period. 18-Hits each for 9,999 a piece makes it deal more damage then even Omnislash. Barrets slightly better then Cid only because he's faster.
Yuffie and Cloud - Yuffie is a better character then Cloud because Conformer can dish out 9999 damage without the HP handicap, not only that, but Doom of the Living hits for 15 times for 9999 a crack, that pushes her above Cloud easily. Cloud is #4 because Ultima Weapon has a huge weapon handicap of the lower his hp, the less damage he does, other then that, Omnislash is a no brainer, he's #4.
Tifa/RedXIII/Aeris - Tifa is next in line because she dishes out 7x hits for 9999, Red XIII's Earth Rave deals out 5x hits for 9999, and Aeris's is only redeeming factor is Great Gospel.
Caith Sith - His limits are nowhere remotely as useful as the ones above, and if his instant kill wasn't random and didn't have the chance to kill your entire party as well, he'd be up higher...however...yeah.
Vincent - Absolute garbage if you don't learn get the DP to it's glitch potential, all of his limits are just random, making him completely useless at the time. Death Penalty was a horrible way to make a weapon.
Note: Again, if you actually spend the time to power up the DP like I did, Vincent kills everyone in FFVII with 1-Hit! This "could" potential make him the most overpowered FF character of all time simply because of this. However most players will not take the time to do such a thing as it's just downright ridiculous...I did it once...and never shall I do that again.