{Final Fantasy 7 spoiler}
Well, for example, Aerith lives in Traverse town in Kingdom Hearts. However, Aerith is killed by Sephiroth in FFVII, so it probably makes most sense for Kingdom Hearts to be a prequel to FFVII. Some things don't align, such as the way characters are presented with other FFVII characters, or how Aerith lives in Traverse town rather than the Sector 7 Slums.