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I do find this master mode intriguing. The game itself doesn't tell you this unless I missed something in the instruction book, although I have heard of it somewhere before. I beat it again yesterday picking the staff and rejecting the sword, guess I'll pick the sword and try to see the difference.
Sephiroth isn't hard as long as you keep leveling up... even if you choose the sword, you will eventually get decent in magic. It just takes longer than choosing the staff...
Weaker in Magic makes the game harder? What did I choose in Expert mode? Probablly the staff because I always chose the sword and wanted something diffrent...