The 32X seems to have been a bad idea, requiring a whole add-on to a system that was mere months from being superceded. It tried to offer a premium 32-bit experience on the Genesis, a sort of "half-step" between the stock Genny and the Saturn. Instead, people ignored it in favor of the upcoming Saturn. Those who bought into it at launch were out $160 for an add-on where a good percentage of the games were half-assed Genesis ports.

But the Sega Virtua Processor (SVP) could provide a premium experience without having to buy any extra hardware. Nintendo made great use of enhancement chips, and games with Super FX chips inside could give the 32X a run for its money. They pushed these enhanced games and found great success with them. The Genesis wasn't designed to make use of enhancement chips as well as the SNES was, but it would have been something to provide that "half-step between 16-bit and 32-bit gen experience" that Nintendo was doing well. While the only game with the SVP, Virtua Racing, was 100 bucks at launch, if they'd made more SVP's prices probably would have come down and $80 games would have been a possibility. In addition, games with the SVP chip would have to be something a cut above standard Genesis fare to sell at the higher prices, whereas the 32X games didn't have to prove themselves in such a way. I don't think Sega would have done as well as Nintendo going down the enhancement chip route, but I think 10-15 good SVP games in 1994-1995 would have helped Sega compete with Nintendo's Super FX games while avoiding the 32X debacle, positioning the Saturn as Sega's one true 32-bit system.