Your question kind of has multiple parts, so I'll try to tackle each piece individually...
- General frustration with 7H: You're not the first, but part of that is because unlike FF8 (which because of underlying technical choices, means only the Steam version can currently be modified in a worthwhile way), FF7 can be modded for both the original PC-CD release (which I have), the Square-Enix store release, or the Steam release. The latter two are based directly on the first, just with differing bits of registry cruft and installation methods. But it also means there are three different versions to support instead of just one. The most important part of getting FF7 to work with 7H is successfully running the Game Converter tool (linked to in the 7H installation tutorial). If you haven't done that yet, you need to start there. If you have, you can post up your FF7_GC.log file and we'll take a look to see if something seems fishy.
Downloading mods directly: Yes, nearly every mod in the catalogs (both EQ2Alyza's default v2.3 and Strife98's Mods of the Round) has a release thread here on the forums, which usually include a direct download link to the IRO file. You can then use the IRO tools in 7H to unpack the file into its components, and drop the results into the correct \direct\* folders, making sure that "direct_mode = on" is included near the bottom of your ff7_opengl.cfg file (it should be if the game converter ran successfully).
Alternative mod methods: As part of his massive Reunion update, DLPB also created a new modding framework that works a lot like the \direct\* system does. I haven't had time to really give it a good thrashing (what little time I have is given over to testing and packing things like Project Edge, ESUI, two unnamed/unreleased gadgets, and a totally new graphics driver), but from what I hear, folks generally like it. The biggest hang-ups right now are a limited library of pre-existing mods (it's barely a couple of months old and the bugs are still being worked out, but almost anything in IRO format can be unpacked and made to work with some effort), it requires that you have a workable understanding of directory hierarchies, and aren't afraid to go editing .ini files. I'm also not sure if it allows for easy fallback methods (a great example is with field textures... 7H allows you to load Project Edge first, then have Satsuki as a fallback if you enter an area that PE hasn't remodeled yet).
Finally, have you posted in the 7H thread for some help? I also had a bear of a time when I started a little over a year ago, but we eventually traced it down to my having somehow stumbled across an older version of the converter that didn't set one of the flags correctly o.O
