Sonic items in Sonic 2 battle

You mean the sonic items in the black market shop? Well, those sells eggs which come out themselves, by breaking them or by spam-care them.
They also sells food wich you can give to your chao, you can see at the chao doctor what kind of food they like and eats the most. There is also chao food which ads points to every stat. And an apple can give sometimes 2 or 3 stamina boots instead of 1 a time he eats.
There are also seeds, you can give those to a chao who have followed lots of lessons in the chao school, and got a scoop and water can will be able to do it in the ground and let it grow. It the fruit depends on which seed you choose.
And as last there are masks for chaos to put on their head, it's just for show it doesn't give more defence or anything.