I am surprised that this doesn't have a higher rating! I thought the sprite work was done very well! I can totally believe that most of these were custom made. They have tons of mobility. I thought it would show Mario and Luigi as babies at first. You did talk about their origin.
Even weirder, Mario and Luigi weren't in this that much! They weren't even together! I still love this, because it's great to see old sprite work. I guess sprite work here is akin to 2D animated movies nowadays. It's great for nostalgia.