And I would hope it means they feel some obligation to escalate things even further for the final fight against him. I don't need a Sephiroth fight in part 2. Save the final fight with him for part 3, if it is a 3-part thing.
Part 2 will need a big finish though I imagine, so maybe the final fight will be Jenova in the northern cave, with the ending after that being the whole photo reveal and Cloud falling into the lifestream and shit. Or maybe you fight a wounded Sapphire weapon (it survives the Sister Ray this time).