A variation on Eggy is The Crack.
Eggy appears as a sentient egg with the legs similar to Sonic the Hedgehog and a single blue eye peering through a crack in its shell. Eggy can be easily identified by its short animation loop and will often emit a rubbery squeak when interacted with.
See: List of Eggys
As a placeholder Edit
Eggy also serves as a placeholder model for what would have likely been proper NPCs and quest triggers and are named uniquely for their in-game appearance. Many of these placeholder Eggys have a unique name ending in Egg.
Many placeholder Eggys were fictionally used to transcribe the current thoughts and feelings of MJSTUDIO staff during production. Due to Sonic Dreams Collection's presentation as a long-lost prototype, these fragmented glimpses into the sexual explorations of the Sonic fanbase can be discovered through normal gameplay.
As Eggy shares both Sonic the Hedgehog's legs model and eye color, we can assume Eggy represents an unborn Sonic the Hedgehog (and by extension, player-made OCs) and serves to reinforce the game's theme of rebirth. The various Eggys that litter Eggman Origin possibly signify unborn OCs that have not yet been swallowed whole by the Egg Baby and cannot find their way to ascension.