There was a project where the next console would have been the Genesis, 32X, and CD in one box with a new name. I don't know if that would work, or if it'd be viewed as something of an in-between generation, like the Turbografx, and people ignore it.
It's probably be easier to develop games for, unlike the Saturn. It's not the only thing that held the Saturn back, but it didn't help.
There's a little wiggle track burned into PSX discs that's impossible to duplicate with burners, and it won't boot up unless it sees that. There's workarounds that eventually came out, but console copy protection doesn't have to last forever. It only has to last most of its primary life until the next gen comes out, and PSX managed that.