Rean has a pretty simple and typical teenage problem, and that is a complex about belonging and who he really is. I think his quote in the first drama cd summarizes it pretty well:
“The reason I want to know is so that I can truly be myself. There's a Rean Schwarzer that I should have been all this time—the one that's your brother, the one that's Mom and Dad's son, and the one that's a member of Class VII—and I intend to find him.”
Considering that is just at the end after one of his big epiphanies (that gets repeated in Cold Steel II) and he still feels he’s clearly not there shows pretty much how bad actually is. Frankly, I feel that Rean may be just as screwed up as Joshua, but just like Joshua in FC he’s very good at hiding it.
But let’s start from the beginning. Since Rean has memories he has known he is adopted (this in contrast to Elise, who was told do 3 years before I think?). Now, being adopted can already be a big can of worms with identity issues. But we also have to add to that the noble/commoner divide and how Rean feels responsible as the reason his adoptive dad stopped attending noble socials gatherings (which he feels his dad belonged to). The result is that despite having of one the most loving families an adoptee could, he feels he does not belong there: an adopted son instead of a natural one, a commoner instead of a noble, etc. This leads to the beginning of the first game; Rean, having decided he does not belong with the Schwarzer family, decides to find “his own path”.
Now, a small distinction with this. While I will repeat this “lack of belonging” sometimes, this does not mean Rean doesn’t love or even feels responsible for those people. He clearly loves his family a whole lot, and even while hesitant he still consider Ymir his home. It’s more of a feeling of not being “good enough” or not fitting than of a lack of love, something I think we can all agree is fairly common among teenagers.
We’re good? Then let’s continue. Now Rean is introduced to class VII, the course starts, etc. We see that Rean still feels really insecure about his identity when he hides his nobility (again, likely a feeling he does not belong there). He also lacks a bit of a sense of purpose and is a bit bland, which is actually pretty genius when you realize that’s the point (which for bonus points, Falcom also managed to thematically join with a high-school setting to make it even more noticeable and archetypical!). That Rean is running away from his identity as adopted son of Baron and lady Schwarzer, meaning he is pretty much trying to make a new one as he goes along but doesn’t know where to even start; he doesn’t join a club despite being proficient with the sword and lute (and having friends in half the clubs!), he clearly refuses Patrick’s invitation to join noble’s gathering (though in that helps that he is a prick) and he really seems to only be comfortable when he’s helping others (i.e. denying himself).
Still, he generally improves through the game, and by the middle of ToC he seems to have more or less found a place in class VII, one he values a lot (and spends the game reminding us about it). But this place comes a bit at the price of denying his old spot with his family. Rean, now confident about finding a path, feels he can ditch his place in the Schwarzer family, and there comes the confrontation with his sister. In that chapter is shown how Rean had started distancing from her sister and family, likely in preparation. I think those scenes make pretty clear that Rean somehow feels responsible of his sister, loves her dearly and yet still feels he doesn’t belong with the Schwarzers. A bit of a hypocrite in that, which may also explain why he’s so blind to her feelings (Rean is dense, but he doesn’t feel that dense in his bonding events).
So, this brings us to his ogre power, and here comes the real problem. Rean seems to have control issues with it, but frankly they seem a bit different than normal. After all, the first time he used his power he managed to save his sister from almost certain death, and she never treated him any different for it. Not only that, his power seems to be an amplifier more than a sheer surge of strength; as a child is likely that his father (who is skilled enough to take down jaegers) could have managed him even in the worst case. But the problem is not the power in itself, but rather what it is. It’s a power from outside this world, that doesn’t belong anywhere else. Rean feels like he has inside him someone who is literally an anathema to every place he may belong to.
He believes that he can’t belong with anyone who has seen his power, as they have seen a place inside him that doesn’t fit anywhere. This is also why he trained under Yun Kafai and why he has so many problems with his power: he’s trying to squash it, to deny the power inside him so that he can fit in the world, while at the same time redirecting his whole life to protecting others (especially Elise) as the only “useful” part of his power (which is also why he is so much of a martyr without cause). This is why not even his family managed to crack down his barrier, and why he’s so reluctant about sharing anything about his power. Even at the drama cd, after 7 freaking months with class VII he still lets out this line:
“Rean: [Self-derisively] Haha... Having second thoughts about wanting to be around me? I wouldn't blame you.”
He has very, very deep issues with his power and what it means for him.
Still, the events of the old schoolhouse, the fight with viscount Arseid and the drama cd happen, and Rean seems to slowly be on the good track. I want to remark however that he hasn’t solved his problems, not by a long shot. Even after the intermission of ToC II he only managed to reach the conclusion that his ogre power is him and he is his ogre power, which only transfers the big issue he had with his power (a power outside from this world not belonging anywhere) to him directly.
And now we’ve reached the school festival and the ending of ToC. Everything breaks down. In desperation, Rean accepts another other-worldly power in order to protect his friends and confront Crow. However, in his worst nightmare, he ends utterly defeated. Not only that, he has to see how his friends risk his life in order to save him, the opposite of what he wanted and denying him what he saw as the only utility of his power. He wakes up, is rescued by his family and recovers a bit of the bond with them… only to again be a witness to his father being injured and Vita taking away the princess and his sister, all while his ogre power (his second power whose only usefulness was in protecting others) ended completely useless and maybe even worsened things.
Frankly, the fact that at this point Rean somehow managed to keep going is something of a minor miracle. It’s likely that his complete focus on reuniting with class VII was the only thing remaining in him and by this point he was already kinda broken inside.
But he manages to recover Class VII, and with it a bit of confidence. Even when the Pantagruel takes him it’s not that bad; it’s a bitter defeat surely, but with his sacrifice he managed to avoid anyone harming his friends through the use of his power by giving himself up (even if it was a bit pathetic). But most importantly, the intermission gives him a purpose again: the talk with the princess makes him realize how dumb his idea of protecting others without thinking of them was, allows him to partly redeem himself rescuing her and gives him an objective in the future in the form of Crow.
But why Crow? Well, Falcom hasn’t been very subtle about it. Besides the obvious implications of reuniting Class VII, Rean sees Crow as a reflection of himself. An outsider, with no sense of purpose in life that managed to befriend a group with seemingly no previous relation all while hiding a side of himself and a strange power out of the normal. Convincing Crow to return and giving him a place in Class VII is basically Rean’s way to show himself he has a place to Class VII and he belongs there. Redeeming Crow is crucial step to accept that he can have a place in Class VII.
Of course the world is not so kind and it steps brutally on Rean’s hopes. With Crow dead, there’s no hope of Class VII returning as he wanted, and it makes him doubt he even has a place in Class VII. In moments, his last shelter on what was already a half broken mind is destroyed. When he threatens Osborne he is completely out of his mind; the apparent lack of value of Crow’s life reflected in what he probably judged as his own worthlessness. At that moment, he probably wouldn’t mind if he was killed; remember that while Rean is passionate he is also pretty level-headed, so his OOC action probably means something.
And then Osborne, like the magnificent bastard he is, changes the situation with two phrases. To the broken teenager with no identity nor place to belong he gives him both: the son of Osborne and the national hero of Erebonia.
And then the time skip.
While the first time I was also mystified by it, after seeing it again it all clicked. Both the divertissement and the epilogue are not explicitly about advancing the story; at most they offer fragmentary views of events. No, their purpose is to show how Rean has stopped forming part of class VII. And by his own choice. Manipulated by Osborne, his own broken mind and self-deprecation, but by his own decision nonetheless. That’s also why he refuses to go with his love interest (whoever it is) or Toval; while he has problems with his choices, he feels that this is the only path in which he can belong due to all his (perceived) faults and problems (and Osborne undoubtedly putting pressure at the adequate points to avoid a realistic alternative appearing). The divertissement already has Rean admitting it explicitly, while the epilogue itself is the end of Class VII, in which everyone follows their path outside Class VII after their leader has done the same.
TLDR: Rean’s identity and belonging issues last through all the first game, and the second basically breaks him with them.
