What I didn't understand is why Nintendo waited until it was essentially finished before doing something. Unless they were really oblivious to it's development. Either way It's out now and once on the internet, there is no taking it down.
Welcome back! I heard about the Metroid 2 remake and it's sad, but not surprising, that Nintendo shot it down. It took years to let a second party touch their IP, much less an uncontrolled third party. Sega doesn't have quite the empire Nintendo does so they're probably happy just to be noticed.