I suppose that makes sense, It's funny how he is helping him get his castle when Luigi is the second banana.
Also I saw Fire Luigi having green fireballs which if that is a side effect of the color limit in the game that is actually neat. You could make his fireballs either go straight with a bit of waving like in Mario Bros's green fireballs and somewhat like Smash Bros green fireball or bounce higher like in Super Mario Advance 2 unless that is not possible.
Also for the Mario Bros actual fire colors you should give one to Wario as well I mean I know he never had one but it's pretty obvious how that is going to look anyways. (I assume he will shoot either giant yellow pink and red fireball?). This is my mock up of how he could look in the game but i made him a little closer to his artwork
As a suggestion i would make Mario and Luigi just simply flash in there normal and fire form when they touch the fire flower but if it's not possible then that is okay.
As for the Koopa Troopas. Yes they are green in the artwork but some enemies have inconsistent colors like Blurp is blue even though there Green. Oh yeah your right, strange how both the green and red koopas act exactly the same but are decoration in Yoshi's Island. Yeah keep them Green.
Regarding the 3up Moons, I don't see how that matters, Because the 5up, 10up, 20up etc. are not really an item as they can only be found in the slot mini games which doesn't really make it inconsistent but if they were a Mushroom/heart item than that would be forgiving to use the. the 1up and 3ups are items, Since the 1up and 3up hearts are different graphics you might as well use the 1up mushroom and the 3up Moon, especially it uses SMW's edited graphics and that the game came out after Super Mario World as well. It would seem rather to plain to use a 1up Mushroom with a 3 symbol on it even a 3up like moon appears in space zone. However if the 1up and 3up hearts/mushrooms share the same graphics but a 3 symbol is pasted onto the heart as a tile with transparency then that is actually fine then.
Speaking of which here is another mock up of some items along with the 1up/3up items.