no it's not really about PRG space, the rom is already 1 MB right now. -- 512 kb graphics, 512 kb coding space.
It's just that the whole 4x bigger thing would require 100 bytes for 1 single screen, instead of 40. And that would go up to like 2800 bytes of RAM needed for level data. That's WAY too much. My levels are only 1C00 bytes of data per level.
I use megafle, i've personally programmed some things in Visual Basic myself to support extra stuff i've put into megaman 3 over the years, that didnt exist in the game originally, like multi paths, longer levels (how many screens a level is), MMC5 mapper "ex attributes" and stuff.
and i have no idea to the answer of your 1st question, cause i dont honestly understand how the hit detection with level data stuff works
and that's why i leave it alone.