Have you already released a previous demo of the game? This is the first I'm hearing of it, although to be honest, I don't follow too many of these projects all that closely.
Now, this is just personal preference, and other people may disagree, but your loops in Green Hills Zone are just way too big. Do you notice how they're so large that the camera not only has to scroll just to keep Sonic on-screen, but the background has to rise up a ton as well? This can be a good thing, or a bad thing. If you want the best effect, shrink your loops down EXCEPT for the last one in the level. The loop takes up a lot of space that other platforms and terrain can't, and naturally leaves a ton of empty space where all you see is the background. As a regular occurrence, it's not a very good idea. What it is good for is a level set-piece. Think about it, the player doesn't have much to do in this part except hold forward, so their attention is going to wander towards the visuals for a good three or four seconds. You have a huge panoramic view of your background in a way that the player wouldn't normally see because there's usually all of the foreground terrain in the way. As a single set-piece, that could work pretty well. Even better would be if you put something special in the background for just that one special location, so the loop frames it in and the player's attention is drawn towards it. For instance, in Shovel Knight, you can see the tower that makes up the final level in the background of the first. Use that special space and timing for some similar foreshadowing or something.
Second, I'm going to sound insane for saying this, but Sonic seems a little bit *too* fast on this. I mean, yes, Sonic is meant to be a speedy character. However, look at the official 2D games, even the 16-bit ones. Sonic has a top speed that you get used to, that seems to stay consistent proportionally to his sprite size, not including the additional speed from something like the Boost in the later games. 8-bit Sonic is a bit smaller and simpler-looking, and the speed should stay proportionally consistent as well. Maybe something like 80-90% of his natural top speed from the 16-bit games. This game has Sonic charging full blast ahead, and with the smaller sprite sizes, it's a bit excessive. (Also, if you slow Sonic down a touch and possibly scale the screen a bit closer so they're the same size as the Master System, you can make the levels last longer and feel larger while still keeping the same sense of speed for the player)
Other than that, the only real design issue that I can think of is that some of the paired springs in Aqua Planet seem like they'd be a bit too difficult for the player to escape the bounce looping. Like, for example, there's a pair at the beginning of the level where Sonic is only on the ground and able to jump out of the cycle for a split second before getting launched back up to the upside-down spring on the ceiling.