DevelopmentMany of the art and characters, and the main storyline has been recycled from an unfinished Dreamcast sequel of Chakan, a Sega Genesis title. The main reason for the similarity is that both the cancelled Chakan game and Blood Omen 2 share their lead artist, Steve Ross. He also co-wrote the Blood Omen 2 story. In addition to the general similarity of themes, Chakan himself differs from the Blood Omen 2-era Kain only in that his body and face are harder-worn and he wears a hat, a worm-riding character is clearly the predecessor to Umah, several enemies bear the "broken ankh" symbol of the Sarafan in Blood Omen 2, enemy designs range from very similar to virtually identical, and the depiction of the streets of the city is essentially a futuristic version of Meridian.
Here's part of the planned storyline:
The City has existed since the beginning of time. Once it was a place of transcendent beauty and purity governed by five beings known as the Aeris. Then, many centuries ago, a catastrophic plague ripped through The City. This scourge cleaved each Aeris into two separate entities: A Siren, a being of light and song, and a Daemon, a dark, vile creature.The striking similarities between these projects and Blood Omen 2 led many Kain fans to believe that Blood Omen 2 was some sort of re-branded Chakan. Some concept artwork was available http://www.andnow.net/chakan/artwork.html
The Daemons soon overwhelmed the Sirens beginning a long reign of brutality and horror. They stripped away the Sirens' souls turning them into pitiful empty creatures who wander aimlessly through The City. The Daemons imprisoned the Siren souls in Soul Worlds; strange domains existing beyond space and time.
With no one left to challenge their power the Daemons began to feed on The City's population. They did not feed on the flesh of their victims, but on their souls, their life force. Through centuries of dark rule The City was transformed from a place of peace and serenity into a cruel, hard, twisted place. A place of horror, death and decay.
There are also some connections to a cancelled game called Siren. More information on the topic is available on the fansite The Lost Worlds.
HyldenThe Hylden are those yellow creatures that were depicted fighting the blue winged vampires in the ancient murals that Raziel kept finding all the time in Legacy of Kain: Soul Reaver 2.
Soul ReaverDespite the depiction of Kain holding the sword known as Soul Reaver on both the game's cover art and it's title screen, in fact Kain is lacking the Soul Reaver, having it taken from him before the game even begins.
Voice ActingA sample of Kain's famous "Vae Victus!" battlecry (used extensively in Blood Omen: Legacy of Kain) was recorded for the name but not used.
VoradorThere has been quite a lot of discussion about whether the appearance of Vorador in Blood Omen 2 has a real explanation or it's just a pulled-out-of-the-nose item, like to give the voice actor something to do. Near the ending, Kain and Vorador engage in a discussion from which it raises a challenge for a future confrontation between them. In this discussion, Kain already says something about Vorador being 'reborn a second time'. This not only begins to explain that there is an explanation behind Vorador's presence in this game, but also might hint the possibility of more installments of the series.
Information also contributed by bächtërmän, Mark Ennis and WildKard