http://opensnc.sourceforge.net/
The OpenSonic team would like to replace the ripped sprites with original characters (in the Spirit of Sonic, but not too close) to have a fully legal and free (as in FOSS/open-source) game.
So if you are a sprite artist or a concept artist with a great vision to create some new characters send them a message!
Also check their request thread on Opengameart:
http://www.opengameart.org/forumtopic/open-sonic
P.s. I am not part of the open-sonic team, but I endorse this request