Quite an interesting read, thanks to Macrepeh for the tip.
tl;dr: Sonic and the Secret Rings (another really lousy title in its own right) diverted a non-negligeable amount of resources, so did Yuji Naka starting his own studio, and the business suits didn't listen to the remaining devs when they said they needed more time. I'd say this explains why the game feels like an alpha build, but that'd be an insult to alpha builds. (Seriously though, I've heard the game was still actually in pre-alpha stage when release day arrived).
Interesting that they spent so much time flip-flopping on something so minor as what the artifact that contained Mephiles should be. Tears, a book, a scepter? They were so hesitant for so long that they still weren't fixed on that (and multiple other things) when the lines were being recorded! Holy shit, and here I thought everything had been said about how and why this game turned out the way it did. Even nine years later we're finding out new stuff.
And what about the final demo featuring much-needed changes that had no chance of making it into the final release, just for the sake of making the game look slightly better ahead of the big day (when everybody finds out they'd been duped)? And why the (previously known) emphasis on this being the first game where Sonic interacts with the human world? This turd basically treats the Adventures and even Shadow the Hedgehog the same way Other M treated other Metroid games: either they never happened, or they happened differently from the way they actually did. (This comparison holds more water when you consider Sonic 2006 visibly wants to be SA1 on steroids and fails miserably at it the same way Other M wants to be Fusion on steroids and fails miserably at it.)
BTW, gotta laugh at "Kingdom Valley" and "short level" being in the same sentence without any kind of negative. Anyone who's played the game would've rather renamed this place "fucking end already". Often followed by "before I get a game over in the inevitable godawful Mach Speed section and I have to do the trials of Soleanna and assorted loading screens all over again because this game is so shitty it doesn't auto-save". But "Kingdom Valley" actually fits on the screen without dropping the font size into the decimals, I guess.
But this piece kept the best for last. It ends with this: "In 2010, SEGA delisted Sonic 2006 as a downloadable title from the Xbox Live Marketplace because they felt the game was harming the Sonic brand by being available for purchase." Sega basically disowned this piece of shit, the thing that should've been their magnum opus. Though let's not delude ourselves, it wouldn't have been their magnum opus anyway. The shitty lovey-dovey script that reeks of character assassination, Eggman's intolerable design, the countless plotholes, the necrophilia + bestiality combo, and so many other things were here to stay, and wouldn't have been fixed if the development lasted five more years.
Fuck this game. It's largely the reason why many people just assume Sonic has sucked nonstop for the last decade, and won't even give Colors and Generations the time of day.