Less is more, but only to a certain degree. I think that with this game, removing or toning down details will take away the lively feel. What's so cool about the art style as it is now is the detail level - trees, vines, flowers, blocks, background, water, etc. It all looks very cool. It's much more than what a Sonic genesis game transformed to 3d would like. However, I do like the mock-up you posted a bit earlier. With lighter shadows and a bit more vibrant colors, I think it looks great.