I do not think it means what you think it means. It's the VERY END of a story, not what you call chapter 5 of 7.
Speaking of which, either the game glitched out on me, or it kicked me in the gonads by design. You know how you can rescue characters with low HP? Well, I was doing the second Valley of Seers stage earlier today, and the game would refuse to let me heal Zelda, no matter how low her HP got. And since her falling was a defeat condition... yeah, it was dreadful. I'll spare you the long version of the story, but I eventually managed to pull it off anyway.
Other question while I'm at it. Do I need to unlock Evil's Bane to get sword beams and all that other nifty stuff on the Master Sword? Because right now I'm not seeing anything. But hey, it's already way stronger than anything else I got, anything more at that stage would be utterly broken.