What about a genderfluid!Cloud AU? (I keep seeing trans and non-binary, but I don't think I've ever seen genderfluid.)
By the time Cloud heard the term, the hazing from his squad outweighed the knowledge that there was a word for what he felt and that he wasn’t alone. At that time the nickname “pretty boy”, meant to be a cruel poke at his androgynous features reminded him that he didn’t think he looked very pretty…and how his eyes lingered on female models and how he wanted to know how they got their make-up like that. Sometimes the feeling went away, but it was taking forever this time.
A sympathetic NCO took notice that Cloud’s fellow infantrymen seemed to shut him out. He also noticed Cloud was a handyman so he decided to talk Cloud into switching his MOS speciality from SOLDIER Training to Mechanics. Having another skill set didn’t hurt and he could get out of here and meet people who didn’t hate him for no reason. Cloud took it and it was like breathing a breath of fresh air. He starting asking people to use the pronoun they instead. It felt better.
The prejudices didn’t stop, but Cloud has someone to defend them now. He sometimes even had people refer or watch make-up tutorials with them. The real turning point was Zack Fair. They got assigned together and…well they just clicked. Zack didn’t blink when Cloud politely corrected Zack when he used “he” to refer to Cloud and just used “they” from then on. It took a little explaining for Zack to understand Cloud, but he made the effort and Cloud fell for him a little bit more.
Zack learned to notice how Cloud would change. Sometimes it seemed hour to hour, other times they would stay feeling masculine or feminine months at a time. It made him happy to see that Cloud was getting comfortable with themselves again. He asked one monumental favor from Cloud though: he asked Cloud to explain their gender identity to Sephiroth. Cloud was nervous…but it went well. Sephiroth seemed to understand something about himself and accepted Cloud’s PHS and email (”I’m a mech, so I check it pretty often for repairs and stuff.”) in case he had questions. Sephiroth did have questions after.
One day, Zack woke up, stretched and found Cloud just sitting and smiling at nothing in particular. Cloud had been trying on make-up the night before with some of their friends. If Zack was honest, Cloud had looked pretty spectacular, but Cloud cleared it up the night before. Cloud was staring at pictures on their PHS.
“You okay?” Zack asked.
“Great,” Cloud said, “I kinda feel pretty right now.”
“Because you are,” Zack assured him.