Part I - The original placement

From my original thread on Twitter

https://pbs.twimg.com/media/EdJmHcyXsAEKCHJ?format=png&name=900x900

https://pbs.twimg.com/media/Edt-atTXgAIgBw2?format=png&name=medium

Part II - The retcon

From my original thread on Twitter

Despite this, it would seem that Sonic CD received a form of retcon after the release of Sonic 4: Episode II.

https://pbs.twimg.com/media/EdOGNV8XkAEguVs?format=png&name=small

https://pbs.twimg.com/media/EdOHFFIX0AAFEAI?format=png&name=small

Ken Balough, Brand Manager of Sonic 4 project, says that in fact Sonic CD has no certain position in the timeline and Sonic 4 has been used to connect it with the rest of the games, where it seems not where it is necessary to take place between Sonic & Knuckles and Sonic 4 or between Sonic 1 and Sonic 2.

Although Ken is not a member of Sonic Team, he was involved in the development of the game with Iizuka, where it would seem that there was no mention of what Yamaguchi said in 1993. Did Iizuka know anything about it because the interview was too old?(?)

Part III - Naoto Ohshima's statement

First of all I would like to thank @TLorestream for finding and sharing this screenshot on my Discord's server.

According to Ohshima, Metal Sonic was created as an evolution of the Mecha Sonic of Sonic 2, since at that time did not yet exist Sonic 3, it was logical that the director of the game thought Sonic CD as a kind of sequel to Sonic 2 according to the logic of Metal Sonic; with the arrival of Sonic 3, then assuming that Sonic CD will have had a retcon that would have placed it after Sonic & Knuckles due to the presence of another Mecha Sonic, likely that Knuckles' Chaotix would have had the task of ''glue'' of Sonic CD and Sonic 3 given the supposed mention of both events in the Japanese manual.

I recreated the conversation because the original screenshot is in low quality.

*Original screenshot*

*Recreation*