Gameplay is spot on, in both 3-D and side scroller mode. Graphics are very nice, with retro music and menus including a flute remix and some J-pop stuff that fits the levels well. If Sonic colors answered Mario Galaxy, Sonic Generations is a clear stab at New Super Mario Brothers.
It plays classic, and is a weird mash up of Mario (Paper version comes closest, but others as well) the most recent Donkey Kong Country, and the fabric looking Kirby game. I found it challenges you much like the later levels in Mario Galaxy, but has a lot of modifiers to help out if you got stuck in a certain spot.
Some weirdness though, including an emulated version of original Sonic that doesn't have any scanlines or aliasing options, and only displays in two modes; blown up and kinda fugly or teeny tiny (like 20% of the TV screen) but smooth. And for whatever reason, the cutscenes look very much like playstation 2 level, jaggy as all get out. I usually don't care about graphics that much, but they are jarringly bad. Sub wii even.
But taken overall, this game is finally what the fanbase has been dying to play for the last 20 years(!). A nice remixed Sonic without all the guns and werewolves and human girls to kiss that have plagued the series, aside from Colors. Highly recommended for any Sonic fan.