"Depending on your actions in Ch1, up to 4 characters from the forest area might be back in Ch2."
I have some guesses.
First one should be pretty obvious; Aoi needs to be saved from the Fairy Ring. Alba should stay alive no matter what. If we meet Aoi again, we'd probably also meet Wendy, with a first appearance.
Kozmo might be one of these 4, depending on breaking his cube and giving him the strange sculpture as a replacement.
Kett might be another consideration, connected to Kozmo as an option for his head, and the candle seller who's unpetrified.. I don't think Kett was in particular trouble, but feeding him the weird chips probably did something.. Wonder if there's permanent side effects? Maybe they're demon drugs and they just look like chips.. Hm.
Speak of, The Prisoner whom Red is neglecting to supervise got a jar of slugs and a weird blue candle. It'd be hard to imagine that he just wanted them for fun... Perhaps he can use them as a medium to curse something or someone in order to escape? Ah, maybe he can cast a particularly complex 'curse' that turns the slugs into monsters, or maybe increases the acidity of their mucus to escape.. Or use them as remote controlled drones to retrieve more items or call for help.. Casting unlimited curses is just too powerful for him to never appear again. He did promise to meet again, if possible, right?
So in conclusion:
1. Aoi
2. The Prisoner
3. Kozmo
4. Kett
5. Candle-seller?
6. Locked Site Primordial?
The last two are kind of unlikely, but the locked site can be passed with wire cutters, which may set it loose. I'd think some demons would go and patch the fence, though. Heck, maybe it has an auto-repair magic applied.
I'd be surprised if Aoi or The Prisoner weren't included in those 'up to 4', either way.
Edit: Ah! The Caterpillar! Of the two moths camping!
Hm.. With that, I'd probably knock down Kozmo as a random side character..
So
3. The Caterpillar
4. Kett
5. Kozmo
... Yeah, I think I'm most confident in The Prisoner, then Aoi, then The Caterpillar, then maybe Kett or someone else. I might be forgetting someone, but eh. The Caterpillar could grow up and become the ninth moth or something.
"Sai's gonna have kind of a bad time in chapter 2."
Hmph, that's what he gets for not seeing Lacie home!
Unfortunately, Sans isn't here to warn him.
"We're looking into making "Little Kat's" shop a bigger part of the game: Our hope is that you'll be able to buy some extra items with coins that can help you in certain quests or can alter the storyline in little ways."

Little Kat is so cute!~ 🥰
"Hiro will take on a slightly bigger role!"
Bigger than being Lacie's brother??? :o

"Another big issue with very spaced-out releases is that you guys seem to theorize... A LOT. We suspect that with enough time and detailed analysis of chapter 2 and its secrets, some people could come close to figuring out many future story details :) That would be bad."
How is it a bad thing? :o
It's fun! :D
"That being said, if that were the case we wouldn't change the story just because someone figured out a plot point."
That's good! No need to move the goalposts, so to speak. Subvert expectations if that's the goal, like No Country For Old Men, but don't subvert them for no reason~
"Basically, right now we're working on the whole game and not just Chapter 2. We're gonna keep going in this direction, despite not having a very clear release idea/deadline in mind."
It's not really necessary to have a deadline, but if you want to use them, I'd say the best way would be to just have private deadlines. Rather than being forced to meet expectations of hype, it's more like a personal or team goal to set and achieve and reflect on. It's easier to determine some sort of success or failure and how to continue onwards if there's a set goal. Likewise, it could be difficult to determine what's wrong or what can be improved if there is no clear goal or deadline.
It's not all that serious, though. The ultimate goal could be "Complete Paper Lily", and as long as the team has a heartbeat and game dev is a fun hobby(?), and there's the general strokes of the story set out, it'll eventually be complete, probably.
That all said, read World Trigger Chapter 246 for a better explanation of this by Hyuse Cronin, lol.
"This means it'll be a while, we're talking years still (sorry, dailypaperlilynews!). If we could somehow work on this full-time, that'd be the dream. But life unfortunately doesn't allow it at the moment."
Ehh, I don't deign to understand another's life better than them, but usually the barrier is just not having millions in the bank to sit on.. Like Team Cherry devving Silksong. This is why I wish I was rich, lol. Don't we all? Alas, I am not, so I merely give many of my two cents. Ahh, life.
"Managing everyone's expectations can be hard (we've lost sleep over it at times), and we're always trying to reduce the stress load on ourselves, which is why we aren't very vocal about our plans/promises."
Ya gotta sleep to live the dream!
Yeah, in general keep a good balance. Don't promise too much, have fun creating, and deliver a good game. Be like Team Cherry, lol

"Things will keep changing and there's no reason to keep you all tangled in our scrambling. At the end of the day, developing Paper Lily needs to be fun, so that we can deliver those positive feelings to you all through the experience!
We'll do our best though, as usual!"
yippee! Yes! It needs to be fun! With just a tasteful helping of depression! Yes, positive feelings such as pitying Miss Knives and surprising the demon!
"Here's a few details about Rich Flavors:
The genre is comedy/mystery with some light horror/gore elements."
Food? Gore? Horror? Mystery?
"Perfectly portioned by a dagger serving the finest leftover dessert"?
"Since Paper Lily is still some ways away, it's become necessary for us to consider some financial milestones to keep the dream alive, though we try not to dwell on this."
hooray for capitalism, yippee for practicality
"So... we'll see what the future holds. Right now we're nervous and excited, which is a great combination for making cool things happen."
Nervousness and Excitement, both are anticipating something important.
"Thanks for reading! Even if you're only here for Paper Lily, we still hope to be able to surprise you with something different every now and then."
I'm-a-here-a for-a fun-ah!
"For any other questions, bug reports, etc, you can email us at leef6010@gmail.com. (We've been doing a really poor job at replying in decent time lately, apologies.)"
Eh, don't sweat it! I think the responsiveness is good! If the same questions pop up often, maybe consider a different method? A forum? A FAQ? Set aside a particular time to reply to them?
Oh, no, I've run out of text to respond to! What a travesty!
Take everything I say with a mountain of salt, and an ocean of water to dilute it in! In the end, I just loved the games, I'm looking forward to Rich Flavors~
Good morning, afternoon, evening or night!
Have fun, everyone!
❤️
