I've actually done some work on this today! In its current state, the game is playable (in a very basic state) up to Dracula's castle. Currently you can acquire the candle, light it, go downstairs to the basement, grab the ham off the table, and acquire the tiara from the chest. I have yet to program in killing dracula and getting the keys, though.
So far I have no random encounters programmed into the game. Right now Red Riding Hood just stands next to a tree in one screen and isn't there anymore once you give her her basket and come back to the same screen again. I'm going to wait to program in all that fancy stuff until the game is completable from beginning to end.
After everything is programmed I'm going to concentrate on some better writing (right now I'm just copy+pasting from the AGI texts), then on to the background art, then sprites and animations, then music and sound effects. It's nice seeing the game playable this far, though, with the regular AGI animations.
Also, just to bring this thread up to date a bit, I've scrapped the arabic "2" for the title screen and thrown in the roman numeral instead. It was just too difficult. I decided to make it look more like King's Quest IV's title screen than King's Quest I's as a nice result. But it still has the same blue buttons from KQ1 underneath the title.