I ported over all of angrylion et al's fixes from their MESS-derived plugin. Things look considerably better blending-wise, but unfortunately, texture seam issues remain.
Some noteworthy improvements:
MAME now runs in MESS via the N64 driver:
Mario 64's trees, shadows, and decal textures look much, much better thanks to the perfect Z handling:
Likewise, Mario's textures are finally correct thanks to the updated Color Combiner and Blender handling: