I think they genuinely do not believe Sonic's side characters are popular enough to hold up their own games, especially with how normal Sonic games sales have been slipping for years. Honestly they probably are not wrong, but it is still worth a shot. It makes sense to give other characters a more experimental game while they focus on making the highest quality mainline game they can in the meanwhile.
As for the budgets, Sonic games are traditionally on the low end sure, but so are all of SEGA's other games and those almost all turn out great now. Poor management at Sonic Team and SEGA Japan just caring a whole lot less with what they do with the franchise as the games are typically meant for Westerners are the biggest issues. Throwing money will not fix anything either as Boom is the highest budget effort in the franchise's history.
They absolutely are aware. I theorize that a lot of the fans wishes are communicated to them, but poorly translated or described. The best example is something like they constantly hear about the physics needing to be more prominent, but that ends up turning the movement into the weird heavy stuff you see in recent titles.
The one thing I wish they would learn above all else is that they absolutely need to stop trying to emulate Nintendo games. It just simply has never and will never work, Sonic was meant to be an anti-Nintendo design.
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