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A single Chaos Emerald is seen as vastly superior to the rest of the cast and having unlimited power.
Sonic and co only ever fight Emerl when he was amped by all the Chaos Emeralds, and they were all going to die to Emerl's self destruction from absorbing too much of its energy, so obvious outlier and narrative inconsistency.
Next up is scaling to Chaos 2, 4, 6, and Perfect Chaos (Exclusive to Generations). Problem is Sonic and co need to actively exploit the weak spot in Chaos to do any significant damage to him or has to freeze his body to depower Chaos.
A lot of people point to the characters fighting a clone of themselves while empowered by the Chaos Emeralds. Not only is this really bad circular scaling, but it once again contradicts the narrative.
Eggman notes the Egg Dragoon is powered by Dark Gaia's perfect form energy. Sonic at the beginning of the fight literally notes how the green spot on the Egg Dragoon looks "fishy" and he has to use the weapons on the Egg Dragoon against it to do significant damage. So he doesn't scale.
I should note that Sonic should stay put no higher than tier 7 (Specifically 7-B) given Sonic and co were all going to die to Infinite's star, which was calced at 7-B+.