Hmmm, I'm not sure about the random coins in blocks thing there sk8, imho it's a fairly large change to mario sinse one of the biggest points about the game was learning precisely in each level where all the various items were, and which blocks you should and shouldn't bash.
the warp zone thing is deffinately somethin I like though. there were several levels in games like super Mario world which worked rather like that, and imho giving the player something to learn is always good.
It'd be quite nice if you could get the game sounds to the point where players wouldn't need a description of each level in the manual to play them, ------ perhaps by having tutorial levels which showed off the various enemies and their effects. While I agree you do probably need some good information in the docs of audio games, sometimes it can slightly spoil the surprise.
As you probably already know, the Lost levels was the Japanese only sequal to original Mario. the gameplay was basically the same, accept with much harder level design, and some slightly annoying tweaks, such as having Piranha plants keep going up and down when your standing next to the warp pipe which they're coming out of, reverse warp zones that actually took you back in the game, and unexpected enemies such as Bloopers attacking in overland levels (you could stomp them at that point though), as well as the poisonous mushrooms I already mentioned.
elemental blocks would also be a new one for Mario, though super mario world did have a vaguely similar system of switches which would make blocks of various colours appear on the levels of the game. this was particularly fun sinse activating one switch on a later level could create some different blocks on an earlier one and let you get to other areas. Perhaps adapting the switch system to work in a single level would have a similar effect to the elemental idea and keep things relatively close to original mario.
I think doing a full audio port of Mario with a completely represented vertical dimention is entirely possible, but would (as we've been saying about audio Metroid), require several indicaters and a bit of learning from the player.
As you said Sk8, you'd need a stepping sound for Mario which changed when there were blocks above your head, but you'd also need an indicater of when there was a block low enough for you to jump ontop of, sinse just because a block was above you, that wouldn't mean you could necessarily jump ontop of it (it might be too high up).
then, you'd need an indicater for when you were at the edge of a particular block, and probably a different indicater for when there was a pit below which you needed to jump over, and when you could safely drop down onto the ground.
finally, you'd need a walking into a wall sound for when you walked into a block on the same level as you horizontally.
Given these indicaters though, I don't see any reason at all why Mario shouldn't be fully convertable into an audio game, with all the original level design intact.
Our souls with high music ringing; O men! It must ever be
That we dwell in our dreaming and singing, A little apart from ye. (Arthur O'Shaughnessy 1873.)