About hacking the PS1 version...
Unless you have the ability to re-author a whole new CD using Squaresoft's BIOS sector accessing system, you aren't going to be modding anything.
I'm probably going to be putting this in a FAQ soon...
The PSX version of FF7 does *NOT* load any data by filenames. You can delete the directory entry on 90% of all the files and the game will still run. (They fixed this in FF8, where they got rid of filenames all togeather)
The game is hard-coded to look for data directly at sector locations on the disk. The game doesn't look for models by opening a file called "cdrom:/enemy/cloud.lzs" It looks for sector 3753983 and is told to load 16 data chunks in 8k segments. Unless the data you replace is exactly the same size and exactly on the same location of the disk, it's not going to load. You make the file larger, you are going to overwrite other data. If you make the file too small, you will underun the streaming buffer and most likely cause a divide-by-zero error.
Also, this is a PSX we are talking about. You have about 512 bytes of texture space for your character. If your character has eyes, you have used half of it already. The system only has 2MB of video ram, and a 3rd of it is being taken up by the video buffers, and a half is for the background, you have about a 5th of it used for statics and text.... You really don't have enough room left for textures after that.
If you can tell me where the master sector lookup table is for loading data, and if you can sucessfully edit it so that it won't point to the hard-coded locations on the disk, *then* you can actually start editing the data....
Keeping in mind that you have to make sure that any extra data is properly timed for entery into the polygon ordering table, and that you don't have a DMA buffer overrun when you stream the data packets to the GTE. You are also going to have to make sure the extra data isn't going to choke the GPU, which, if not timed correctly, will lock your rendering pipeline.
The PSX and PC data formats are different. PCs are well-known for happily taking garbage. On a PSX, if you mess with the rendering pipeline just a little bit, you've locked the system and you aren't going to be drawing anything on the screen.
Not even garbage.
You don't tell a PSX to "draw a model" like in OpenGL. You have to hand-make every data packet that's going to the GPU. I wish you luck, but I think it's a fool's errand.