In regular FFVII you can be outta Midgar in about 3 hours if ya really hustle so even with extra content I really dun see "Vol.1" being Midgar-only. A good first stopping point might be after ya get on the boat to cross the sea. But even then that feels light on content since the entire first continent of the game consists of Midgar, Kalm, Nibelheim (via flashback), Chocobo Ranch, a cave, Fort Condor, a single room cave ya can't enter until later into the game, and Junon.
Vol.1 would prolly end well after the Temple of the Ancients with Cloud going nuts giving the Black Materia to Sephiroth. It would make for a pretty crazy To Be Continued wtf moment.