After playing the game, I am going to take the controversial stance and say that for the *most* part, these artists knew exactly what they were doing. When you see the game in motion it really does read better than these still screens would have you believe. These graphics were not designed to be viewed stationary, but in motion. If we compare this to the holy grail known as Metal Slug (granted, it's slightly unfair since they're different genres) This game tries to stress detail but at the service of the gameplay, whereas Metal Slug with its dull colors, while beautiful, is not the most functional game it possibly could have been, with characters constantly being lost in all the crazy but earth-toned animation. It's a balancing act and we see examples that fall on either side, and I think in this case there was a compromise between the artists and the game designers: the artists got to make their sickly detailed crazy designs, but had to keep them readable when moving at high speeds. And it's quite impressive that they accomplished that goal. I really recommend everyone see the game in motion in a clearer form than Youtube before casting their stones.
If anything this game is a lesson that designing pixel art for the sake of art differs, sometimes dramatically, from the functionality of putting it into a working game. But I believe that tension sometimes produces our best work, and this game is a very interesting anomaly.