And another post about how to handle depth sorting here:
http://natejc.com/blog/2011/11/as3-displayobject-auto-sorter/

Hope that helps!

I am a flash programmer in Malaysia and currently involving in a similar game project that using side-scrolling brawler style. Do you mind to share how is the collision detection method that using in the Kungfu Panda Tales of Po? I am pretty sure it is not only checking hitTestObject method only. Thanks.

I programmed for the worst-case scenario: a fast-paced action game where all of the objects are moving nearly every frame and there is a high probability of multiple necessary depth swaps. This is when the hit on the cpu is likely the most intense in-general and so this method of depth-sorting becomes very efficient since it doesn’t do any additional checks or conditions that might slow it down if every single object passed the conditional checks and needed to be sorted.

The best-case scenario would occur when objects aren’t moving much or at all. “Optimizing” this as you suggest would most definitely help performance in the best-case scenario, but would hurt performance in the worst-case scenario. In all of the games that I have made, the best-case scenario has always been when there was the lightest load on the cpu. So if I have to choose whether the code will perform better in the best-case scenario or better in the worst-case scenario, I choose better performance in the worst-case scenario.

If it’s not common for objects to swap frequently in your game, you could easily add a flag to each game object that changes to true if the object has moved since the last frame. Or handle it a number of other ways too.

Since, it just so happens that all of the games I’ve created so far fit into the worst-case scenario I described above, that’s why I wrote it the way I did. Hope that helps. Thanks for the feedback.

If you have the source and just want png’s cut from it, you can use one of many tools such as this one: https://github.com/pixelrevision/texture_atlas_generator

Anyone here want to write such a program? I’m personally interested in such, and none currently exists, so I’m requesting someone here with programming knowledge to write such a program for me. Thanks in advance.

Is your issue for going from a Sprite to a Bitmap? Then you could just use this code instead:
var r:Rectangle = sprite.getBounds(sprite);
var bitmapData:BitmapData = new BitmapData(sprite.width, sprite.height, true, 0x00FFFFFF);
bitmapData.draw(sprite, new Matrix(1,0,0,1,-r.left,-r.top));

Kept giving me an error. Thats my experience in it.