Here are my thoughts on your hack (please note that I'm up to W5, so my thoughts reflect your hack up to that point):
First of all, I like the music used. Now while that is a good thing, you used songs from various games (YI, Kirby, DKC, etc.) which in my opinion, don't really go that well together. Also, you have some inconsistency in the sound effects. For example the SMW coin SFX in some levels and YI coin SFX in some levels - I think you should have just stuck to one throughout the hack. On top of that, some of the sound effects (like jumping) screw up very often. Also, I felt sometimes a big variation in the volume levels of some songs so I had to force myself to lower it in some cases. Of course, that's a little bit nitpicky.
I think the level design is alright. It's not too good but at the same time it's not that bad either. Some sections were quite fun to play but others were boring and frustrating, most probably because of a lack of a good difficulty curve. It's pretty nice that the wall-jump and long-jump are utilised in this hack quite often, but I don't see myself using a U-jump anywhere.
The story seems a little bit interesting so far - I'm glad it's not your generic save Peach from Bowser plot. Your dialogues are severely messed up though and I think you should have gotten most of it proof-read by someone good at grammar since since you said it yourself the cutscenes might have errors here and there. But hey, I found some of the dialogues quite bizzare and funny, especially Mario's ones.
I am not a fan of your bosses at all. I've probably fought around 10 of them, and pretty much all of them have the same attacks. They are boring, repetitive and frustrating and seem like a very poor usage of the n00b boss. It's pretty much this: the boss runs left and right, shoots fireballs and sometimes hammers or other enemies and takes X hits to kill. Please do change them or at least make them have different attacks.
There are TONS of graphical clashes. It's like you just randomly slapped graphics from the GFX section in your hack without even checking if they match the style of your hack or not.
Now, for some small things.
I didn't really like the change in some things, such as the Goomba palette and fireballs. It's like you tried to fix what wasn't even broken in the first place. You have some palette issues here and there but nothing major. There is slowdown in quite a few areas such as "Full moon fortess" and "Mystical lava fort". There's no incentive to collect coins or Yoshi coins since collecting them pretty much does nothing (but I guess that's not really a big issue). There's also many bugs, for example this.
Overall the hack is alright, but please keep in mind I am trying to provide more constructive criticism than comments like "z0mg nice hack!!". If you fix up certain things (bosses, grammar, etc.) then I am sure this hack would be even better and people would enjoy it even more.