This is the sequel to the hugely popular 1986 arcade game. This game was made for the Master System and then ported to Sega's System E Board for Arcades. The System E Board is very similar in power to a Master System. The first Fantasy Zone ran on the System 16 A board which is comparable to early Mega Drive\Genesis titles. In other words this game was step down in terms of graphics and sound.
The game is very brightly coloured like its predecessor and is hugely influential, along with Konami's Twinbee in setting the aesthetic for "Cute 'em up" games like the later Parodius and Deathsmiles titles. As far as Master System games go it isn't pushing the system to its limits, but it is a good looking game. As far as 1987 arcade games go it is a step backwards compared to Sega titles like Shinobi.
The arcade version despite being graphically and audio diminished I still rank higher than the first game. The gameplay seems much fairer. It is still rock hard and a challenge even for schmup experts, but shops are more frequent and the enemies are a bit more evenly spaced out in early levels. However. it has an annoying warp mechanic which is frankly excessive.
The Master System version is a slight step-up from the first game. The first being an Arcade port albeit a very good and faithful one. This one makes the most out of the hardware.
The game has a cult following and boxed copies can be expensive, but not silly money. Out of the two versions the Master System is the one to play. A DX version was made for Playstation 2 as part of their Fantasy Zone Complete Collection. This was a Japanese only collection which runs on System 16 B hardware. Fantasy Zone II DX is absolutely fantastic and brings out the best of this game technically. I would say play the Master System version if you are a schmup fan and absolutely play the DX version if you are simply an arcade game fan.