Tip: You can use Lunar Magic's Overworld Layer 3 Editing system to edit or create your own layer 3 images (castle bricks, fish, rocks) and apply unique effects per level via the Layer 3 Bypass in the main editor.
This sprite (and two others) was meant to be released on this C3. However, due to real-life problems, I just missed C3 and ended up releasing nothing.
Anyway, these are the clouds that you find in NSMBWii's 7-5.
They blow a smog that obfuscates Mario when he's near.
They also can be killed with every kind of attack. The smog may optionally push Mario back.
Make sure to specify the smog's sprite number from list.txt in sprites/foo.asm! Check the two ASM files for configuration options.
Credits go to ArnuroMinigon for drawing (editing?) the graphics that come included.
I've forgotten the exact way the sprite works, but the smog should take the high bytes into account. It's does, however, make smoke sprites, which don't have high bytes for their X and Y positions, so they appear on all subscreens.
Seems like an interesting sprite. Maybe if you make a future revision, I'd like to see the extra bit used to make the smog interact with Mario; you could make it push him back so that this sprite becomes a hazard.