I hate to be the party-pooper, but... The palettes are correct, but I think some of the animation would be impossible to achieve.
Uhm, this is just a "proof of concept", or rather, an animatic, where Sander is giving the artistic direction to the concept he created in an easy, edible form for the coders to know where they are going exactly without lots of trial and error. If you have a big picture like this where you can see how everything fits, it is much easier to lay out the routines. Sander is an excellent art director (should get a Scene.org award ). The actual implementation would of course be modified depending on restrictions of the hardware but the essence is to be kept.
Then again, "impossible to achieve" is something I wouldn't dare say around the C64 demo scene.