Quick update: Currently learning a bit of ASM to make this game better, since I realised that the chances of me getting all the necessary blocks, sprites and level ASM without it are slim to none. Current progress is average, with about 20 custom blocks taken care of on day 1 or so.
Next update will be to try and code some level ASM and generators, before moving to full custom coded sprites of various kinds.
As far as graphics are concerned, those are progressing too. Now have the perfect background graphics from Actraiser 2 for the forest castle, which is being redone to look more like Stormrook (the gold one) rather than the dark/spotlight focused one I'm currently using.
More layer 3 backgrounds now exist too.
Edit: Update on the update. Have figured out how to make custom blocks, as well as basic sprites and generators/level ASM.
Some stuff that's already done is:
Unfreezing a level by hitting a fireplace with a fireball
Custom On/Off Blocks with special block behaviours based on their status
Doors that only open when all Dragon Coins are collected
Switches that flood/drain the level (this has been done a million times now, but it was easy none the less).
On/Off Switches activated by enemies
Blocks that are either spiky on bottom or on top based on Switch status (ala Yoshi's Island)
Enemies moving Mario by hitting certain blocks
Platforms only usable if Mario/Luigi are on Yoshi
Proper power up filters
Mario teleporting to the screen exit if Yoshi eats all berries on screen
Or jumps on all enemies without touching the floor
Barrel Cannons that explode after using them
A system that kills Mario the second he gets any points in the level
A storm cloud that tracks Mario on screen and tries to blast him with lightning
And a few other minor things of that nature. Currently trying to get proper bosses and more complex enemy sprites working, with multiple attack phases and patterns.