Yes it can. As I demonstrated, you'll NEED a Sega CD installed. If you try and run a BIOS WITHOUT a Sega CD installed, you will just get a black screen.
You need to download a BIOS in a cart form(i.e. BIN, GEN, or MD) and boot it with the Everdrive in the cart slot. The BIOS you need to use is the one that corresponds with the game(like running a Japanese Mega CD2 BIOS on an American Sega CD2 for a Japanese game). Before I had the Everdrive, I used to have to change the region before burning. Now, I don't have to. Just burn and go!
Here, these are the files I used in that video:
http://www.megaupload.com/?d=XPOKMT2W
Just put these on the Everdrive, and follow the video. Good luck!
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