The only problem there is when Knuckles players reach Red Mountain... http://sonic.wikia.com/wiki/Red_Mountain
We are building this in minecraft, so we could add a layer of blocks from bottom to top on the outside of the mountain that are separated and require jump boost to reach the top. It'll be challenging and will solve the issue of wall climb.
I'll post a screenshot of what I mean when I can get on the computer.
Also, about the courses, we could have multiverse worlds for each character's course/map, giving access depending on what character people choose. That way people can't go into other character's worlds that they haven't chosen (maybe they can choose a different character once they've finished their first characters course/map). We could also have a PvP world that all players have access to and where we can build arenas for people to battle.