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That was only to test the ability of the A.L.I.V.E. 2 game engine running on Xbox to produce large crouds, something OWI wanted to do more and more throughout the Quintology. I’m convinced it was actually Munch’s Exoddus they were working on at this point; The Hand of Odd had gone under long before.
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I have to agree, Lorne kept refering to "our next game", and it was shot during the promotion campain for MO...
My bet is that Hand of Odd was put on hiatus the moment they switched to Xbox.