What it looked liked to me was the first movie was suposed to be just a long episode. It didn't seem that movie-ish to me from the scenes they showed. It also seems like they used the action clips in Mewtwo Returns (especially Misty, Brock, and Psyduck running.), but my memory's foggy since it's been ages since I've seen it, so I could be wrong. It could be posable that the original idea for the movie could have been made to make Mewtwo returns with a few minor changes.
Though the part I'm more curious about was the harbor lady, Misty and the little girl (That I shall call Mei, because I think that's her name anyway...). All I got from that was Mei could have been a main character in the movie...also the harbor lady could have had a bigger part in the whole skeme of things, like she could have been another on of Misty's siters or an aunt and Mei could have been her neice or cousin or just a random kid in in an orphanage that the "harbor lady" ran. But like Crazy Weavile said, we may never know...