Prototype Zones/Dust Hill
From Sonic Retro
Dust Hill Zone
The Mystic Cave Zone we're familiar with is called Dust Hill Zone in this prototype.
This appears to be a demonstration level created by Sega to test how certain elements would work. We see some strange, and downright insane, arrangement of objects that makes the gameplay extremely difficult. There is no ring or enemies in this level, and debug mode is necessary to get pass numerous pits that would be otherwise impassable.
Act 2 is more of the same of Act 1, which isn't terribly interesting to say the least.