There's a real story behind the Sonic character. It's the thrilling tale of a dumbdev who thought it was a good idea to add a new character two days before release. Honestly, the Sonic fight is garbage. There was a better Sonic character with less broken attacks, but that one didn't fit in memory.
AI is kind of an interesting thing with MUGEN, since you don't really know much about what each command is associated with. The original MUGEN and this port use the "just press random commands" approach, but I think modern MUGENs have proper AI built in. It's something that needs a large amount of tweaking though.
Anyway, thanks for playing, I hope you didn't fall victim to the random web freeze of death!