Shenmue III Set for Xbox 2 Launch

Yeah, but the footage of Shenmue for Saturn included footage from both Shenmue I as Shenmue II (Ren, Shenhua, China,...), so this seems like the point where they split the project up in two: Shenmue I for Saturn, and Shenmue II for Dreamcast. From there I follow your explained theory.

Btw, from what I've heard, Sega started working on Shenmue III in 2000/2001, but after a few years work (which brought development on Shenmue III quite far), the project's development slowed down (somewhere in 2002/2003). I don't know what happened after that, development either stopped or was quietly resumed up untill now. Shenmue Online might or might not have had influence over the development of Shenmue III, since Sega's Korean partner company is creating that title. I am desperate for new information, but I guess I'll have to wait, but not too long since they say 2005 is the year of Sega.