So if you have 4 on Cloud and 4 on The Beach Plug, if Cloud casts Fire 3 on a Bleach Plug it does this: Beach > Cloud > Beach > Cloud > Beach > Cloud > Beach > Cloud which results in you getting hit.
Actually it'd hit the Beach Plug.
Fire 3 from Cloud (4 Reflects) onto Beach Plug (4 Reflects) -> bounces off of Beach Plug (3 Reflects) -> bounces from Cloud (3 Reflects) -> back to Beach Plug (2 Reflects) -> back from Cloud (2 Reflects) -> to Beach Plug (1 Reflect) -> to Cloud (1 Reflect) -> Beach Plug (0 Reflects) -> Cloud (0 Reflects) -> and Beach Plug gets hit with the Fire 3, since it has no more Reflects.
As for changes to Yuffie, maybe have her come with a Sneak Glove so Stealing early on isn't a pain, and for her Innate Ability changes... maybe something along the same vein as Geo Guard and Second Wind? Maybe a Self Haste when she defends after a certain condition is fulfilled? Or maybe she gets a buff when someone uses the Steal command, similar to Cloud's Limit Boost?
EDIT:
BTW, legit Cid Date Scene when?
EDIT 2:
I just noticed that the Barrier Materia grants Shield (in addition to Wall and Reflect) when paired with Added Effect, but Shield Materia doesn't grant anything when paired with Added Effect.
Also Aerith's Wizard Rod heals MP instead of HP, making it even more vastly superior to the Princess Guard. The in-game description says the Wizard Staff heals HP.
EDIT 3:
So I hopped back over to my normal mode file and I'm not sure if this is a result of having endgame gear, stats, and whatnot, but Ozma was a total pushover. My first attempt was hilariously bad since I still had Hidden Element on my weapons (which resulted in a very dead Cid, thanks to Ozma absorbing Hidden causing the Venus Gospel's drain effect to reverse). My 2nd attempt completely steamrolled Ozma, with Holy Element on my weapons, and Aerith bopping Reflect + Wall (+ Shield) on the party. Reflect kinda tears Ozma apart, since he heavily favors Lv.?? Holy for countering (at least in this attempt), and Ozma nearly takes 9999 from the reflected Lv.?? Holy. Flare Star did laughable damage, leaving Lv.?? Death and Doomsday as his only ways of damaging the gang. Flare Star doing under 600 leads me to believe you're supposed to fight Ozma around the first visit to Nibelheim or during Disc 2, but Doomsday being almost strong enough to wipe my Lv.99 gang of Aerith, Red, and Cid with Wall up makes me think he's supposed to be fought at the end of the game. (I also got an unnamed Item with "? ? ? ?" as its description. what's this for?)
Viridian Weapon was surprisingly tons easier to beat than Carmine Weapon, largely thanks to Shield being useful against it. Unfortunately, I don't think Long Reach will be finding its way on any of my characters, and probably isn't a good reward for taking down Viridian Weapon (especially fighting it without using Shield).