There aren't different timelines or universes. Zack is a virtual reality bubble inside the Lifestream. Hence why he can see the yellow galaxy ring in the sky. It's the same ring that surrounds Cloud's Subconscious when he falls into the planet at Mideel. And when Aerith is the boat in the Cave of the Gi, she feels Zack's presence, because he's in the Lifestream. Biggs is also real in the Lifestream, but characters like Elmyra and Marlene are actually Whispers in Zack's virtual reality, which is why they know so much. Cloud can now see the yellow ring in the real sky because part of his consciousness is trapped in the Lifestream when he connected with Aerith and Sephiroth at the end of Rebirth - it's just a precursor to what will be the Cloud's Subconscious level. Tifa even had her own moment in the Lifestream at Gongaga and saw her memories, and Whispers, though more basic than Zack's, a kind of proto-virtual reality because she's not dead.
The Arbiters of Fate had a sword, a gun, and fists - who do they remind you of? They are Whisper versions of Cloud, Barret and Tifa. The Whispers are kind of like oracles or prophets, they are a way for the Lifestream to have a voice (kind of). The WEAPONs are the beasts that protect the planet as a last resort, and the Whispers are influencers, the first point of call. What doesn't make sense is that Shinra, especially Hojo, has no interest in the Whispers at all. They are crazy about WEAPONs, the Promised Land, etc., but they never talk about the Whispers. Either they are special to Cloud and the gang, or they aren't written as good as they could be, because otherwise Hojo would be capturing them and experimenting with them.
