Progress on the new project is going very well. I am cranking out characters and environments while planning the story. I want at least six more characters. Currently there are 18 weapons, but that will go up to 30 once I begin to paint the crossbows. It sounds like a lot, but each weapon is categorized for a particular animation set, so no additional work needs to be done. The backgrounds are overlayed with a dirty texture. There is a visible seam down the center of each environment, but it will be fixed.
The two unarmed characters and the jester are friendly townsfolk.
Next comes the fun frame-by-frame special effects for spells, such as fireballs and explosions. I found this inspirational article that describes the basics.