@CrazyTails: The Genesis is capable of 256 colors, but only a very small fraction of those at the same time. Most games would average around 25-35 colors at any one time though, with some of the better looking games on the console like Vectorman, Ecco the Dolphin: The Tides of Time and Eternal Champions going past 60, sometimes up to 70.
SEGA CD is much more capable of holding more colors at the same time. WaterMelon knew this, so it is weird they never just moved to SEGA CD development instead, like all other indie developers.
@Barry: The amount of resources needed in the cart to work with the SEGA CD at the same time is phenomenally high. It would have been extremely pricey to do that, plus they would have had to make new cartridges for the hardware to "Know" what to do. Would have been a waste of time and money.
The idea existed at the time, but it was considered much smarter overall to just remake the game to play on SEGA CD, like the Ecco games were. They could have just made a version of Sonic the Hedgehog 2 on there and it would have sold great. I think I heard rumors about it being considered back in the day, but I would not know where to look for that.
The SEGA Collection games on SEGA CD that came bundled with the SEGA CD had slightly better versions of stuff like Streets of Rage and Golden Axe, but just to improve *some* sounds.