Some tidbits from a hands-on/interview at PAX, courtesy of Sonic Retro forums:
Originally Posted by Shade Vortex:
Also, he confirmed CD was retrofitted to take place after Sonic 3 & Knuckles and before Sonic 4 Episode 1. He said the original developers of CD never put it in any specific place in the timeline, so they decided to say that it's before Sonic 4.
He also told me that when Sonic CD is released and Sonic 4 Episode 2 is announced, there'll be a trailer where Sonic escapes from his detour. Here's a bit of explanation on that. See, in all the Sonic 4 trailers, Sonic is chasing Eggman from the left of the screen to the right. In the Sonic CD trailer, there's a signpost instead, and when he hits it, he takes a detour and does the story of Sonic CD. Once his CD adventure is over, his detour ends, and he goes onto Sonic 4 Episode 2 (I guess for story sake, E1 is being skipped? He said the next trailer would have his detour end by him going to S4E2).
Also, he confirmed the US soundtrack is not currently planned for use in the full release, due to licensing issues, but they are trying to work around that and come up with a solution for us fans, someone suggested that if it's monetary issues, they could have the US soundtrack as DLC, which sounds like a good idea to me.
He also said that Sonic 4 "will never" use the Retro Engine, because the codebase is incompatible with the Sonic 4 engine, which they are still using for S4E2 (though probably with tweaks, since he says they are working to make it better and resolve complaints).
Guess Episode 2 will be based on Sonic CD like how Episode 1 was based on Sonic 1 & 2.http://forums.sonicretro.org/index.php? ... t&p=614941