I have had this issue too many times when reaching the end to the organ in the castle.

I have had this issue with so many of my friends that we decided that it was probably a problem with when we were entering the castle or with defeating the bosses. In the end we played the organ according to the Walkthrough that I bought with the game when it was released in 1999. I also used gamefaqs.com which has also helped with so many issues in the walkthrough that Bradygames walkthrough had missed out.

When playing the organ in the sequence it tells you to repeat the bars to the next room are suppose to go down. if they don't you try again. it got to the point for an hour I was trying to figure out why I can't get through. I even tried to reset the playstation and do the castle all over again. Did not work. I still have the game saved on my memory card and til this day I still try to get it to work. However when I played the whole game over again, the first try I had gotten through.

I have noticed too that certain things in the game are imperfect if they are done incorrectly. I had an issue where in Trabia at one of the forests, ever two steps I would end up in a fight with a Snow Lion (good EXP and AP experienced points!). Even with the Enc-None or Enc-Half, I would still get encounters. It has happened once in Deep Sea Research center and I restarted the game and it kicked in. I have two copies of FFVIII and they are different with how it works. I also have two playstations and a PS2. With the PS2 the game works better but the glitches are somewhat there.

One thing I hate though is with the Gameshark how Zells code does not work but that is a gameshark issue. ActionReplay had fixed the glitch which also helped me get through the gameplay faster to defeat Ultimica. The debugging mode does not work at all.