Genesis:Sega CD Model Differences
Some page content & researching taken from io55.net's Genesis Add-Ons page with permission, in collaboration.
Models
Models are arranged chronologically.
“CD (Model 1; front-loading tray)” (1991-1993)
The initial model of the Sega/Mega CD, originally released in December 1991 in Japan, followed by North America in late 1992 and PAL regions during the spring of 1993. It is easily distinguished by its front-loading CD tray and the fact that it sits directly underneath the Genesis/Mega Drive with the expansion connector protruding on the right-hand side. It is designed to specifically pair with a model 1 console, but can be used with a model 2 by removing the console's rubber feet (this is even mentioned in the model 2 manual). There are no controls on the add-on itself; the disc tray is opened by resetting the attached console and is closed by using the controller. Green "Ready" and red "Access" LEDs are on the front bezel while all connections (DC input, RCA audio out and 3.5 mm audio in) are grouped together at the rear.
All Japanese and most North American units have a drive mechanism manufactured by Sony while most PAL units have a drive made by JVC.
Service Notes
Unfortunately, the model 1 is plagued with reliability issues such as bad tray belts, dirty limiter switches, faulty helix/Archimedes screws on Sony drives, and leaky capacitors. The main board in particular contains a number of SMD capacitors which must be replaced, even if there are no visible signs of leakage. Leaky capacitors can also be found on the "sub" board in the vicinity of the voltage regulator. Systems with a JVC-manufactured drive can also suffer from bad capacitors on the drive controller board.
“CD (Model 2; top loader)” (1993-1996)
Introduced in early 1993 alongside the model 2 Genesis/Mega Drive, the model 2 Sega CD was a drastic redesign which did away with the front-loading tray in favor of a cheaper top-loading design. This is perhaps the most common version of the Sega/Mega CD, especially outside Japan. The Genesis/Mega Drive sits on top of a thin base which houses the unit's motherboard while the drive mechanism sits to the side of the attached console. Although designed to match the model 2 console, a model 1 Genesis/Mega Drive can be used on the model 2 albeit with the console partially hanging off the side. Sega included an extension piece to provide full support when used with a model 1. A lone disc access LED is on the top front, while all the rear connections are exactly the same as on the model 1.
Two major revisions of the model 2 CD exist, one with a board manufactured by Funai and another manufactured by Sony. Funai boards are physically larger and contain all of the drive controller circuitry and associated ICs. Sony boards are smaller and have the drive controller circuitry offloaded onto a separate board which the laser is connected to. For North American Sega CDs, these can be easily determined by looking at the label listing the manufacture date. Funai units will be marked with "FN" while Sony units have "SNA". Funai systems have either a Sony or Samsung laser whereas Sony units can have either a JVC or Sony laser.
In terms of reliability, the model 2 CD is far more robust and does not have issues with leaky capacitors or tray issues considering its top loading nature. The most common fault with the model 2 is the fuse, which can be blown if the wrong AC adapter is used or if the Genesis/Mega Drive is attached or removed while the CD is still plugged into power. Thankfully this is easily repairable and can restore the add-on to working order again.
References
https://en.wikipedia.org/wiki/Sega_CD
https://gametrog.com/sega-cd-model-1-2-information-specs/
https://gametrog.com/how-which-sega-cd-system-do-i-have/ (howto tips)
https://www.reddit.com/r/SEGAGENESIS/comments/8w7fpa/model_1_or_2_sega_cd/
https://gametrog.com/how-to-connect-hook-up-sega-cd-1-front-loader-to-genesis-model-2/ (M1 CD on M2 Genesis)
https://gametrog.com/how-to-connect-hook-up-sega-cd-2-clam-tray-loader-to-genesis-model-1/ (M2 CD on M1 Genesis)