Interesting.
I'm not gonna lie... I liked it. It featured some of my friends as voice actors, which was a plus... but let's talk about the movie.
Yes, the idea HAS been done before, but you managed to make it work. In terms of animation, some of it was good and some of it was just sloppy. For example, your growing and skewing tweens are a little bit too slow. Especially for Bill Board (think I got that right), which needs to be skewed to fit his talking more. I do that kind of thing all the time and it isn't too time consuming, so you should try doing it.
Some other movements were a bit too slow too, but again, a lot of the animation was pretty good; that being the parts that didn't need ease. So here's a big note. You HAVE to start using EASE in your tweens. If you don't know what that is, then PM me or something and I'll tell you. It makes all the difference and makes sprite movies much more visually appealing. It would help in lipsyncing too, though you did really good with that anyway, especially the goomba.
So in conclusion, I like this movie. Just make sure to use ease in your tweens next time (if you are doing this, then use more because I didn't notice it at all). I came up with this Flash idea once actually, but I never did it because it had been done before. That didn't stop you though, and you did a pretty good job. Sometimes originality doesn't matter to me, if it's a good idea that is. Keep up the good work.
(P.S. If you haven't seen this idea done before, watch Bowser's Kingdom: Eps 666 and Left 4 Dead Bros.)