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.
A fine update! Take note that Koopas interact with this patch somewhat unintuitively - if the player stomps on a Koopa and knocks it out of its shell, burning the Koopa but not the shell will allow the sprite to respawn. This is due to the game recognizing the shell as the "original" Koopa, and is not a shortcoming of this patch.
Tested with Asar 1.71, Lunar Magic 3.04, SA-1 1.32, Snes9x 1.59.2.
Technically not a remoderation, however it would obsolete this patch in case this patch is approved. Mine doesn't waste sprite slots to fix this issue, as that just causes more issues. I just mark the table at $161A to indicate the sprite in said slot shouldn't be reloaded.