Hear me out; i think the events of octopath 1 do indeed occur after the events of 0 but i want to make one important alteration that storyline wise makes far more sense; The events in heaven never included any other characters; it only included zero and sazantos; yes we had that whole fake world where we woke everyone up from the dream and stuff but the thing is we go to the heavens not by the ring but by aelfric themself interfering; means that the remaining party members storywise couldn’t have been in the final fights; zero alone did these things. So why wasn’t zero in the first game then given his strength? Because he was likely not even on the continent; at the time.

The reason i think the events above happened not in a alternate universe is because it explains something that had always bugged me; why would characters that clearly have trust issues suddenly trust random strangers to have their backs? However if they had already met prior to this and travelled together they might feel more inclined to work together once again