Aside from awesome new games like Demons of Asteborg, people are working on amazing ports like Simpsons Arcade, Castlevania Symphony of the NIght, Starfox, and Darkstalkers. There's even a Resident Evil demake being worked on. You can find this stuff on youtube. There's even a Streets of Rage 2 hack available now that has all of the playable characters from the recently released TMNT: Shredder's Revenge.
The development scene on the old Sega console is pretty amazing.