So I ripped the HD YouTube video and watched this on my tv (42" 720p plasma if we want to get specific). It does look great in HD! Shame I won't be trying it out on a tv of that size, guess my 20" iMac will do.
What I'd love to see are these graphics applied to new level layouts and stages. Rather than remaking all of Sonic 2 in HD, why not make a wholly new game complete with new zones and long lost characters like Fang as a boss character or Metal Sonic as a playable character? As it is, I'll gladly play a bit of the finished game, though I gotta go with the original in the end. Still, looking forward to seeing Casino Night zone.