Unfortunately it does look like it is stretched out on the iPhone X. Sega have just stretched the image to fit the screen, pretty poor optimisation really! I have taken the two screenshots at the exact same point one on my iPhone 7 and one on my iPhone X.
Is it just me, or did this game stop working altogether? Was feeling like some classic Sonic action so I tried to fire it up, game just goes into a black screen and then crashes.