They were scrapped later on for unknown reasons, and the use of the chao are pretty much unknown as well! But there is official concept art that proves that Chao were orginally gonna be in the game in one shape or form! See the concept art down below!
What do you guys think of this?
Ooh that would have been cool. If they had made it in I would have liked them to look more like the regular chao though.
Ok, I really like the second to last one. X3 And the first one on the final row.
Also, I like to think that Eggman's Furry Form is a Chao, or at least part Chao.
They scrapped down due to Wii U limitations. That what I have heard by some article.
But somehow they bring designs on Sonic Dash 2 but isn't being mention as Chao lol