One of the reasons why C and other high level languages weren't popular for consoles, is that the code generation was often larger than anything you did with assembly. That mattered quite a bit back then. Compilers were still rather unoptimized in the early to mid 90's (both code and speed). I would think the z80 would lend it self better to a C compiler than a 65x, but still, assembly isn't that hard. It's rather easy, actually. Macro's can help with consolidating code in the source file, so that it's easier to read - as well.
That said, some Genesis games were coded in C, with assembly mixed in to speed it up. Ecco is one of them. But of course, 68k is very compiler friendly. Hell, coding in 68k asm is almost like a high level language compared to 65x asm - heh. 68k has got to be the easiest processor that I've ever coded for. It's almost a difficult task to write piss poor performance code for 68k.