I love the way the two of them are sort of talking in circles around each other. On the one hand, you have Zack trying to be considerate of Sephiroth's conglomeration of neuroses surrounding interpersonal contact, hygiene, touch, personal space, privacy and similar; on the other hand Seph is wondering why Zack's not following through on the whole "sex" issue he raised months ago. On the one hand, Zack comes across as being a bit uncertain regarding the whole business of men with men on the practical side of things (possibly even virginal); on the other hand Sephiroth has read the manual, knows the theory and therefore can't see why things aren't moving as per the manual.
The core of the whole issue, of course, is the amount of socialisation Sephiroth hasn't received in his lifetime. Zack still subconsciously expects the man to understand things which have a purely emotional and social basis (such as "moving too fast" or "going too far" in a sexual context), and while he may be consciously aware at some levels that Sephiroth learns about life by reading the manuals, he hasn't fully absorbed Sephiroth only learned about this particular facet of life by reading the manual. Most sex ed books don't go into the social and emotional context of sexual behaviour very deeply - instead they tend to concentrate on the practicalities of hooking up the plumbing, so to speak, and also on the various things which can happen to clog up various pipes should you make a mistake. Sephiroth probably knows how to prevent pregnancy and disease forward, backward, and sideways (and could probably recite it in his sleep, should he be quizzed on the matter) but he doesn't understand the emotional scope of what dating means (as evidenced by his puzzlement over Zack's comments about meeting Zack's parents).
Can't wait to see what happens next, and how they manage to work their way out of this one.