To me it was that humanity ended and the earth and creatures thrived. It was a pretty bold ending at the time for an FF game, imo, but of course can be interpreted in different ways. Curious to see how they will handle this in the Remake.
It's not that "humanity was a cancer" or that Holy wiped it out on purpose, but the tragedy of Meteor already was summoned, and the clash of Holy and the Meteor, to protect the planet, ended up wiping out humanity, but the result was to save the planet. That was my feel, and it's definitely a mixed-feeling ending (in my headcannon), but it's still positive in that the planet and it's flora/fauna was saved, and this to me goes with the themes of protecting the planet from the evils of the current human civilization and Jenova.