Shame Sega is so backwards at this. I would bet that M2 feels completely the opposite. Why would you ever develop a game on arcade hardware and not want to see it in an arcade.M2 is a developer which has to buy licensing rights. The license holder was very unhappy and upset to see it in arcades and on real hardware again.
Also, the game originally released in 2008. Sega has had 10 years to release it as an arcade title. They haven't. The 2014 3DS version is something different entirely and would never run on a System 16.