They were thinking that the hypertext revolution would hit the CD-ROM market like the CDTV used to use. And thinking of ways to line their pockets instead of researching and developing new technologies.
A-yup. The "Multimedia!" fad claimed worse systems than the CD32 when people got bored of it. (Sadly it also claimed better, oh the poor Sega CD...)
Weighing in on the main topic: the Neo-Geo AES is basically a Sega Genesis with a more powerful (if weird) video chip, only they wanted 3.5× as much for it (to say nothing of the absurd game cost.) The A500 cost more upon release but by the time of the Neo-Geo's release had undergone a substantial price reduction (£499 to £399, according to Wikipedia,) had way more RAM, and was usable for stuff besides games. The hardware wasn't as powerful for gaming as the Neo-Geo's (being five years older and not
specifically game-oriented,) but quite obviously good enough for a lot of titles.
In a nutshell, the Neo-Geo: a powerful but inaccessibly-priced niche machine with a smaller but excellent library and a deservedly huge cult following. The Amiga: an affordable but somewhat older machine with a large library of varying quality and a deservedly huge cult following
