The initial design looks good and the palette setup too, although it looks a bit too bright for a cave level, specially the foreground.
If you explore the sublevels well and make alternating foreground palette with slight different gimmicks and make the level non-linear, I think it might come pretty well. Additionally, you can use layer 3 to add a few fog effects like some VLDC8 entry did it (i don't remember what level was that but it's in the top 10). But it's up to you! These are just some random ideas I had in my mind.
Looking forward for more.
- SnesLab Discord