Hm.. ponder. All OAM sprites are 4bpp. Fixed restriction. Mortal Kombat III uses 8bpp background + 4bpp cursor and list says okay there.
Alien3 is a 16x16 cursor? That's really big. No priority bit set.. have to check this more carefully and play around with layering. But it could be a palette issue though.
Check this more later.
Okay.. background stars, planets are drawn using sprites! But cursor's completely gone and not in back. Huh.
Background is drawn as grid of sprites 8x7 wide-high. Means it already uses 32 tiles per line. We get max 34 tiles and anything afterwards disappears. But cursor is sprite 1/128 so it should have top priority.
Irony is all sprites tiles use OBJ palette 0. Game's already FastROM.
Auto-merge bump vs edit.
Think I understand problem. It's Range-Time Over: sprite priority on same line. Please try these changes:
C865 = 8F 7C 0B 00
C86C = 8F 7E 0B 00
C873 = 8F 9E 0B 00
This will make cursor top sprite priority.
C869 = A9 CC 31
This will make cursor go on top of password background. Go to 'C'ancel, 'L'eft, 'R'ight, 'O'K to see effect.
Unsure if bug or intended design. But partial neat change.