>>434893551) Marketing. Gen 2 was created during the height of Pokemania, so a lot of the designs were created to be as marketable as possible. The babies were mostly for the people who were fans of the franchise but not the vidya. They were also pretty crazy in the TCG.
2) Thematic relevance. In Gen 2, instead of later gens where the new Pokemon are just the native species of the region that happened to not be in any of the previous regions, the new Pokemon are all recently-discovered species - ones that hadn't shown up enough for Oak, Red, or Blue to catalog them in a Pokedex. This is why so many of the new species are out of the way and excessively rare, why there are so many caves to explore in Johto, and why most of the Gym Leaders primarily use "Kanto" Pokemon - these "Johto" Pokemon are so hard to find, they're only just now being discovered. Likewise, Elm discovering Pokemon eggs was a major research breakthrough, so Pokemon having babies was just as much of a major breakthrough.
