Through collaborative efforts between PinkyNoice, OtakuTAS, and myself, we've managed to improve the movie beyond the previous revision, saving an additional 340 frames.
I am hopeful that this is the final revision for now. I think there may be some minor invisible pixels and perhaps some RNG and puzzle management to squeeze out a few more frames, but I've done the best of my abilities to ensure a quality result.
Part of that work was creating a light-mode Lua script for Dragon Nursery so we weren't fumbling around in the dark. There were also various improvements to minigame routing, some small and some larger, and more generally tighter movement in the flying carpet sections, utilizing newly understood mechanics to gain pixels.
The encode below uses the light-mode script to display Dragon Nursery: