As for 904 Sephiroth Intro, I last played FF7 on my PSX maybe 5-6 years ago, so I can't really remember Sephiroth-related songs, but as I test them on Winamp, that 904 does seem to be different than Those Chosen by The Planet, in that it is very slightly faster
The song for the "cintro" slot should not be a faster version, but rather only the drum part from the song and nothing else. It's distinctly possible that this is why I said the song isn't included, because 904 is the wrong thing. When I can figure out why winamp isn't working, I'll test it myself (or maybe just find a save in that part of the game and use that to test it).
1. Does that mean I can use both PSF and mp3 files to work together? (I kinda assume this is yes, as it seems to be obvious, but just wanna make sure)
The profiles are more for song selection than anything else. The ones I set up don't have different filetypes in the same profile simply because I sorted by collection, but it can definitely be done.
2. How do I get to do this? The input plugin has only one box, and I can't figure out by myself how to get the in_mp3 plugin to work along with it. Do I just have to put in_mp3 in the same folder as in_psf?
Yes. As long as all the input plugins are in the same folder, it doesn't matter all that much which one is selected.
3. How do I configure the PSF and MP3 plugins then? I can configure the plugin for one in the input plugin box, but how about the other? Do I just choose them in the box and configure them separately like usual?
Choose the one you want to configure, and configure it. Simple as that. I should warn you, though, sometimes FF7Music doesn't like to save configurations afterwards.
Also, which one is better (be it better in sound quality, or more stable): in_ds or in_wav?
The sound quality should be just about exactly the same. out_ds uses DirectSound to output audio, and tends to be more stable, but with the disadvantage that it has a very slightly higher toll on the processor (not enough that you'll notice unless you're using a computer from 1996), and possibly takes a split second longer to load (not even 10ms though, it's pretty insignificant). out_wave sends the sound directly to the soundcard, which can be a little less stable, and may have trouble on some soundcards if another sound tries to play at the same time. Really, unless you have crashing issues with one of them, it probably won't make a noticeable difference which one you use.