The hit mark and head tilting back doesn't look weird in the game, I think it's meant to be like that.
The arm muscle to leg thing and ddragon dynamite sparks are LCD bugs, not due to the game code.

Here's Super Double Dragon external artwork: http://tsk-tsk.net/net/extart/tsddragon.zip
And the game is running in MAME.

Guy on the left looks weird ;P
[Linked Image from i.imgur.com]