Earlier this week Guardiola had said he "dreamed as a player to play with" Zidane as he reacted to the round of 16 draw.
The pair have never managed opposing teams in a competitive game during their coaching careers, which have seen them win five Champions League trophies between them.
"I played against him as a player" Zidane said, speaking in a news conference on Saturday ahead of Real Madrid's La Liga game with Athletic Bilbao. "I respect him a lot, as a player and a coach.
"I think he's the best coach in the world. He's shown it throughout his career."
Madrid will host City in the first leg at the Bernabeu on Feb. 26, before the return fixture at the Etihad Stadium on March 17.
The club had criticised the decisions on its website and on social media, where they wrote: "Neither the referee nor the VAR saw the two penalties on Varane."
"For us, the past is the past" Zidane said. "VAR is important.
"We know it's a plus for football. It can improve, of course. We have to be in favour of that. Otherwise, everyone can make mistakes."
Madrid host Athletic Bilbao at the Bernabeu on Sunday in their last game of 2019, looking to keep pace with Barcelona at the top of the La Liga table.