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Leynos said:
Soundwave said:

Smaller CDs would've worked well even with the N64, that would've amount to about 233MB of data per disc for like 5 cents a disc, that would've been a massive increase over the largest cartridge (64MB). 

Angel Studios (now part of Rockstar) compressed a 2 CD game in Resident Evil 2 down onto only a 64MB cart, 233MB (x2 discs) and Angel could've ported that easily or basically any other game on the Playstation. 

This is also back in the day when devs didn't really actually use all the space on CDs for anything that vital. Even Final Fantasy 7 the main game data is like only 250MB or something like that. 

But likely Nintendo would have used caddy (covered) CDs, that was the design layout for the Super NES CD-ROM (the Nintendo version, not the Sony one). You can see the discs come in a protective plastic caddy but are otherwise a full size disc. 

The plastic caddy around the disc I believe also contained a lock out chip to prevent piracy and a small amount of storage for game saves. 

That was a Sony thing for a while. Mini discs used the caddy. UMDs and the earliest versions of Blu Ray used a caddy.

Lots of CD-ROM from the first half of the 90s used a caddy. 

It was honestly not a bad idea, would have also made piracy much, much more difficult. 

Famicom Disk system also had games come in a plastic caddy (rather than a floppy disk design)