In my opinion, punishing players for using the continue codes is a bad idea. Can you think of any other popular games that do that? I can't think of a single one. There might be some, but it's unusual, and it's unusual for a reason. If a game starts with three lives, it should start with three lives whether or not you are using a continue code.
You're saying players can start from the beginning, but the whole reason continue codes exist is because players don't want to do that. I've already played the levels in world two fifty times, I don't want to have to keep playing them over and over. I want to move forward and see new things.
Obviously, you should write a game that makes you happy. That's the whole point. From my perspective as a player, it is unenjoyable to feel like I am being punished by having lives taken away just because I don't want to keep repeating previous levels.
Here is a brutally hard game that understands how to balance frustration and fun: https://store.steampowered.com/app/260790/1001_Spikes/ You start with 1,001 lives, but nobody thinks the game isn't challenging because of that. It's very hard, but you don't feel stuck. You are never forced to revisit anything you don't feel like revisiting just to build up enough lives to advance one more level. The game lets the challenge of the levels speak for itself.
Anyway, I don't like that particular design decision you made for this game. That's the last I'll say on it. You mght be making this game for a different kind of player, and that's up to you.
On the plus side, I do like the new mechanics and obstacles you introduce as the game goes along. The fruit, the spikes, the springs, and now the breakable blocks. You've done a good job of keeping the levels fresh. One note about the breakable blocks: PLEASE tone down the sound they make. It is WAY louder and sharper than anything else in the game. The game's sound effects are generally very good, and very fitting to the environment. That block sound is like someone cracking a whip in my ear.
Edit: I'm not sure what you meant by this:
"Each system has its pros and cons (arcade-style "continue" menu means less keys to type but limited choice to begin a new game). Not easy to choose..."
You can have both. The "continue" button would only be for when you lose your last life. You would see it on the game-over screen. If you choose not to continue, you would return to the main menu, and you would be able to start a new game or enter a level code. The only thing I am suggesting is allowing the player to click "continue" after they're dead, instead of making them go back to the main menu and enter the code when all they want to do is start over on the same world they died on.
