Thanks to EdgeBandanna for the inspiration!
I’ve always suspected that Shadow a.k.a. Clyde lost his memory in an attempt to rout the Empire on his own, and that this is the reason he doesn’t remember Relm or Strago and doesn’t understand why Interceptor instantly takes a liking to Relm. He naturally seems to feel conscience and remorse for working with the Empire, and this doesn’t seem like the view of a cold-blooded killer that he is initially portrayed to be.
I’m not sure what “rout” means in this sentence; it could mean “to put to disorderly flight or retreat” or “to defeat overwhelmingly”. However, given the background, it could mean both:
Shadow used to go by the name Clyde, a thief who worked with his partner, Baram. Together they became known as Shadow, and referred to themselves as “The Great Train Robbers of the Century.” They found a treasure worth a million gil, but the authorities were on their tail. Baram was wounded and begged Clyde to kill him to avoid capture. Clyde was unable to kill his friend and fled.
Clyde runs away and is able to escape. How? Not sure. At any point, Clyde could have lost his memory. But he could have taken a fall, leaving him unconscious for a while. When he awoke, all he knew about himself his organization name Shadow, not who he was. The irony is, he works for the Empire. This is why the theory makes sense; he probably wouldn’t have worked for the Empire if he remembered what they did to him.
Shadow experiences five dreams throughout the course of the game, those about his past as a robber, and his new life in Thamasa:
He found himself in the small town of Thamasa where he married a woman and fathered a baby girl. He could not hide from his past, so some years later he left his wife and daughter and changed his identity. He would wear the attire of a dark assassin, and would never show his face. His dog, Interceptor, followed him out of Thamasa. From then on he would only be known as “Shadow.”
The question is, did he know he fathered Relm beforehand? He might know Relm is his daughter, but Shadow disappeared when she was a baby. Now that’s she’s ten, he may not recognize her. Yet Shadow might know who he is, enough for him to remember another person who recognizes him:
Strago: I have one request… Show me your face. Even if you are him, I have no intention of wasting time trying to talk you into staying. I just want to know… for Relm’s sake…
Shadow: …… (He takes off his mask and shows Strago his face. However, his back is turned so that the player can’t see.)
Strago: Thank you… Shadow. …Come, let’s have a drink.
Developers confirmed this scene in an issue of Jump magazine.
Why didn’t they include it? Probably to keep everything ambiguous. Knowing this scene would lead us to think Strago knew all along. And Shadow would have to remember Strago, his daughter’s guardian. But if even Strago doesn’t know Shadow’s true identity, maybe Shadow knows Strago. For all we know, Strago took care of Relm without knowing of the man who abandoned her.
Relm might know, and would rather not say anything. Strago could have a hint of Shadow’s identity. Shadow may not know or have amnesia about it. Only interceptor knows for sure.
The ending is disheartening as if he did lose his memory, he regained it at a bad time.
After the party has killed Kefka and is escaping his crumbling tower, Shadow says “Baram… It looks like I can finally stop running… Come and find me all right?” (the Japanese version of this translates back into English as “Billy! I don’t need to flee anymore. Embrace me warmly.”). Shadow remains in Kefka’s Tower as everyone else, including Interceptor, returns to the Falcon. It is suggested he did not intend to survive the tower’s collapse, and his fate is left unknown, as he does not appear on the Falcon with the others.