"The place where he awakens—
That is Cloud’s Promised Land
As he sleeps, Cloud hears two voices. The voices of two people very dear to him, who are no longer with him. Playfully and kindly, they give him a message: he doesn’t belong here yet.
When he awakes, there was his friends. There were the children, freed from their fatal illness. Tifa and Marlene, and Denzel asking for Cloud to heal his Geostigma— his family were waiting. Engulfed in celebration, he realises where he is meant to live. He realises that he was able to forgive himself.
And when he turns around—- “she” is starting to leave. Together with the friend who had given Cloud his life. Cloud no longer has to suffer in loneliness… And so they too go back to where they belong.
Back to the current of life flowing around the planet—” ~Final Fantasy VII 10th Anniversary Ultimania
Cloud belongs with his family and friends while alive because he doesn’t belong in the lifestream "yet" (that is stated in the full quote I provided). However, Cloud recognizes where he can achieve his Promised Land before returning to the lifestream — and that’s Aerith’s Church. Remember, Cloud’s Promised Land is explicitly stated to be the “place” where he awakens (and that place is Aerith’s Church).
The other place Cloud has found his Promised Land is at the end of Final Fantasy VII:
"…I think I’m beginning to understand. An answer from the planet…the Promised Land… I think I can meet her… there…" ~Cloud Strife, Final Fantasy VII
Cloud states at the end of Final Fantasy VII, "I think I’m beginning to understand" …and by the end of Advent Children, Cloud understands where his Promised Land is. It’s with Aerith. In life, his Promised Land is Aerith’s Church because it’s explicitly stated that Cloud’s Promised Land is the place where he awakens (ie: Aerith’s Church). That is the closest way Cloud can be with Aerith while alive. Then, when Cloud finally belongs in the lifestream ("he doesn’t belong here yet.”), he will again be reunited with Aerith.
In Advent Children, Cloud finally understand what he was starting to understand at the end of Final Fantasy VII: his Promised Land is always with Aerith. Whether it be her Church, or with her in the lifestream, it is wherever he can be with Aerith that Cloud feels his feeling of supreme happiness.
Cloud and Aerith will one day reunite in the lifestream like Dyne and his wife, Eleanor.
According to Aerith, ones Promised Land is a *FEELING* one gets:
"You search and travel, until you feel it. Like you just know, …this is the Promised Land.”
When Cloud saw Aerith reaching down to him at the end of FFVII, Cloud *FELT* his Promised Land. He says so. Then, in AC, Cloud can also find Aerith in her Church. Her Church is another place where Cloud has *FELT* his Promised Land. In other words, Cloud *FELT* his Promised Land in two places — the lifestream and Aerith’s Church. Why? Because he can find Aerith in both places. Aerith brings him his feeling of “supreme happiness” — the feeling required to find one’s Promised Land.
To determine what causes Cloud to *FEEL* his Promised Land, his statement at the end of FFVII and SE’s statement about Cloud’s Promised Land can’t contradict each other. What is the one similarity between Cloud’s statement at the end of FFVII and SE’s statement about Cloud’s Promised Land in AC? Finding Aerith.
Whether it’s Aerith’s Church or the lifestream, it is wherever Cloud can find Aerith that is stated to be Cloud’s Promised Land. Both Cloud and SE say this.
Cloud’s Promised Land obviously can’t be his friends and family because Cloud has already stated he has a Promised Land in the lifestream with Aerith. Once Cloud is done living with his friends and family, and is finally meant to join the lifestream, he will return the Promised Land Aerith speaks of in MoT and Cloud speaks of at the end of FFVII. In other words, both times Cloud got the feeling that is required for a Promised Land have been in Aerith’s presence. SHE is the common denominator. SHE is the only way both statements regarding Cloud’s Promised Land don’t contradict each other.