https://www.psu.com/news/sega-saturn-mini-hasnt-been-ruled-out-but-sega-admits-difficulty-of-miniaturisation/
Sega has revealed the Saturn is providing difficult to turn into a mini console.
That's a confusing statement. Emulators definitely exist for much more high performance consoles. My shitty 2015 computer can just about emulate an original Xbox.
Here is a list of the chips on the saturn:
The graphics system, the main processor, and the sound system have their own RAM. Additionally external RAM could be added as a card.
Basically all of these chips with the possible exception of the CD controller need to be emulated. Individually none of these are hard to emulate (although licensing might complicate that). Emulating all these chips plus the timing behaviors between them and their RAM is quite hard. Certain techniques can be used to make emulating the individual chips fast but many of these either break down or become significantly harder when you need them to interact with other systems with precise timing. Tight timing accuracy is likely important as some games for these platforms made a lot of assumptions about the hardware they would be running on and may also have exploited undefined or unexpected behavor on the system to increase performance.
That's a good bit of context, but since there are plenty of capable emulators already I think it's more likely an issue with licensing the emulation of those chips you mentioned.
That's true but a company like Sega using an outside emulator - something they, Nintendo, and Sony fought hard against in the 90s (and still do today) - is I think somewhat taboo for them.