Blues hated when he was right. Wiel had become Wily 2.0, or perhaps was Wily, and he used the Mother Elf, an AI so powerful it broke reality itself, to try and conquer the world. The Maverick Virus, once controlled by Sigma, who had some semblance of morals under that insanity, was now controlled by someone with no qualms against killing everything he touched, leaving nothing but scorched earth and broken metal behind him. This war was not the Maverick Wars, not the Wily Wars, but true, devastating war, where one side only sought utter destruction. It finally ended when X sacrificed himself to seal away the Maverick Virus once and for all, his body sealed away forever and his mind drifting through cyberspace.
A scientist who had studied X's readings, Ciel, created a reploid to try and take his place. Unfortunately, the copy had only X's mission and burdens, not his ethics or memories. He decided that humans were more important than reploids, and began killing reploids off to preserve the dwindling energy. Ciel thankfully had not intended this, and allied herself with a resistance group while developing a new method of energy generation. Though she eventually succeeded, Wiel, who had taken power in the last city on the planet, struck once again.
Zero, Wily's final creation, led the resistance to victory every time, but this did nothing to restore the planet. Entire continents were poisonous to human and reploid alike, and the few areas that could potentially recover were unable.
Light's capsules were still around, and Protoman was able to bring it samples of technology so that he, too, could be upgraded. He now resembled a teenager, perhaps eighteen if he were human. His buster was on-par with X's, now, and he had finally caved in and had himself outfitted with wall-sliding and dashing capabilities. The few people who witnessed him believed him to be Zero, and he did nothing to stop these rumors, either- the resistance needed the support, and he did not wish to be known.
In the final hour of the war, Zero and Wiel succumbed to the same fate: death in the burning crash of Ragnarok. Ciel discovered their remains, and a portion of Wiel remained in a chunk of metal imbued with the last copy of the Maverick Virus. Using that as a template, she hoped to recreate X, Zero, and the Four Guardians, this time fully instead of bad copies. All she could get were sentient hunks of metal that transformed into armor for those they deemed worth; Ciel, as their creator, was the only one, at least at the moment.
Humans and Reploids were once again equals, and the government created in Wiel and X's absence enacted laws to fully equalize the two. Reploids would now have built-in limited lifespans equal to a human's, and humans would have cybernetic implants that gave them abilities similar to the average reploid.
In the end, this was what Light had wanted. After so many years of war, after the planet itself was rendered inhospitable, human and machine were made truly equal. X, now a mere spirit, was elated, and Zero happily watched beside him.