I always wondered, what are the bits and tricks that made it possible in X-Men to push the reset button on the sega genesis without rebooting the console?
yeap, same with the Gamecube and n64. If you remember, the n64 had different transitional reset effects depending on the game, others went straight to black, others had more elaborate ways of cutting the action. Supposedly though in the SDK of each console it clearly states that the soft reset command must be present in the final product and in this case it might not be nothing more than an omission.
Reset on many systems is connected to the reset input on the CPU (Sometimes it's connected to NMI or just another digital input for the software to service). This input triggers program execution to be forced to the reset vector (the start of program) and the game will be reinitialized. Because reset isn't related to power ("hard resets") memory persists through resets and a game can set a flag telling the reset code to do something else rather than following the normal initialization (which would wipe the game state). Typically you cannot restore the game to its original state before you pressed reset in software alone, this is because the reset signal may initialize registers and flags and the program counter is lost. So in other words a game could bring you back to the start of a level after resetting or specifically design some game events to use it, but it can't be used as a "jump button" for example (if reset is connected to the CPU's reset).
Calpis nailed it... On MD you can differentiate between soft and hard(bootup) reset, and if your program takes it into accont, lot of fun can be had
You can also do the player a big favor and skip any annoying company logos or copyright/legal screens you forced them to wait for the first time. I also seem to remember some game that if you reset a number of times would do interesting things. Can't really remember what it was though. You could hide things in your game that require the system to be reset a number of times first like maybe as the first part of a secret cheat or debug menu.