Might as well call this the finished version, since barring optimization and cleanup I'm out of space.
-There wasn't really much point in moving away from your opponent, so backward movement has been replaced with a longer backstep that can be used to avoid attacks
-Tweaked a few pixels
-2 new backgrounds (chosen randomly for each round)
-Randomly generated character appearances (loser's character gets replaced after each round)
-Characters now have shadows
-1 new music track
-Options menu to change/disable the music and choose between 3 CPU difficulty levels
-Player 2 could still go slightly outside the screen's bounds
-There's a certain set of inputs that will prevent a character from going into the win pose after knocking an opponent out, thus being able to move around freely and preventing the round from ending. I have no idea how to do it apart from buttonmashing. The CPU will occasionally manage to do this, since technically it's constantly buttonmashing. Don't think of it as a bug, think of it as the ultimate victory celebration!