This reminds me of the FFIV Parom/Polom twins situation. They are both turned to stone by their own will and thus a Golden Needle (remove stone) item does NOT work on them.
In a similar vein, I'd see that Aeris/Aerith died of her own volition and willingly sacrificed herself for the greater good of the planet. It might have been useful/helpful to have a situation prior to the CGI cutscene (or even part of it) where Cloud or another party member tries to use Phoenix Downs, cast Life/Revive, etc and then shakes their head as it does not work at all.
Or perhaps have it as part of gameplay (a brief playable part where you can move around and interact with things) right before the 'water burial' CGI cutscene plays where Cloud picks her up and moves her over to the rest of the party and tries the Phoenix Down/Revive/Heal/whatever and gets the message that 'she has chosen this path and cannot be revived'.
There was an amusing Game Theory episode
on the Aeris/Aerith not really being dead but paralyzed and Cloud is the one who 'killed' her by mistaking her paralysis for actual death.
Back in 1997 when I played FF7 and she died I wasn't sad at all. 'Good riddance to that useless stupid hippie healer girl, now I can replace her with a better party member'. Of course I was still in high school at the time and I hadn't experienced *real* sadness (Phantasy Star II Nei's death) or battled with the emotional complexities of death. It was a video game so I just treated it like a video game thing. No big deal.
As far as effectiveness in battle, Aeris/Aerith is completely useless for the most part. Her Limit Breaks are semi-helpful but completely outclassed by stuff like the Blue Magic (Enemy Magic) abilities. Her Level 4 limit is useful but the game itself is already so easy that such a thing doesn't even help after a certain point.