It is, but even with save states this game is hard as shit. And without them, it'd be impossible to get a perfect in every act. So, if Marc adds the "NO WAY!" screen when using save states, like he did with Sonic 1 @ SAGE, nobody will play it, because of being simply impossible.
EDIT: Remember when I said LZ2 is impossible without cheats or exploits? I was right, as once again demonstrated by nineko: