No. The Master System Converter (I or II) doesn't work through the 32X at all, so you have to remove the 32X when you want to use it.

The SMS Converter II will fit on either model of MD. The original converter will only fit the Mega Drive 1, unless you saw the tab off the back of the converter.

If you have a Mega Drive 1, you should go for the original Master System Converter/Power Base Converter - it's more common, looks neater, and has a card slot so you can use card games or the 3D glasses. The pause button is more conveniently placed as well.

No - they stripped out SMS compatibility to cut costs and make the unit small enough to be made into a handheld.
Originally posted by Raijin Z@Aug. 09 2002, 6:21 am

I just took my powerbase out of the casing to use it on my Genesis 2. No sawing necessary.

good fuckin idea!!! to bad i went through the horendous trouble of finding a genesis 1 to use my pbc. anybody ever get it to work with the genesis 3???
All indications are that the Genesis 3 is not actually a Sega design. Don't count on anything other than basic ROM carts to work on it. Things that have been reported to not work with it include:

SMS/Mark 3 mode (Power Base Converter, Phantasy Star MD, most copiers)

Gargoyles (unplayable because of a bus sharing bug related to the "TAS" instruction, the same reason it was unplayable in emulators until recenly)

Sega CD


Virtua Racing

Game Genie

There seems to be a popular rumor floating around that the compatibility problems are due to a missing Z80 processor. This is definitely false.