Yes it really was.
M2 would have been the most powerful console of its generation (PS1 / Saturn / N64) and slightly better than a 3DFX Voodoo1 card in graphics. Would've been great if released in late 1996. But by mid 1997 it was showing its age, one of the reasons it was canceled. The early dev kits for Dreamcast were at least 3-4 times more powerful than M2 according to Warp's Kenji Eno who had experience working on both machines, two different versions of D2.
Incidentally, the issues of Intelligent Gamer's Fusion report on 3DO's successor chipset to the M2, known as MX. I recall one of the articles stating MX was like M2 on steroids.