It’s important to note that the direct-to-video Disney sequels hailed from Disneytoon Studios as opposed to Walt Disney Feature Animation, which has since changed to Walt Disney Animation Studios.
So for Atlantis: The Lost Empire to have been in consideration for a theatrical sequel was a big deal, as until that point, the only big screen follow-ups the folks at the Mouse House’s animated film division has churned out were The Rescuers Down Under and Fantasia 2000, with Ralph Breaks the Internet and Frozen II joining that lineup in 2018 and 2019, respectively.