I am also attaching P1R file, LEVELS.DAT, PRINCE.EXE and QUICKSAVE.SAV and PRINCE.SAV just in case anyone is interested to look at those. I changed PRINCE.EXE:
"Prince has sword" to "N"
"Win Level" to "13" (Room 5 is default)
"Environments and enemy resources, Enemy" to "F" (Fat)
"Environments and enemy resources, 12b" to "P" (Palace)
This is quite strange but interesting!
The room below the level entrance door at Level 12a is Room 15, where the shadow enters. I have placed walls, so you won't see the shadow (Yes, inspired from Repetition Of Time). You make a sliding turn when you reach the skeleton tile and you keep going right. The problem is, the Prince doesn't die! It keeps going right with lot of funny things on the way:
1. No gate can stop him. No mirror as well.
2. No guard enters into fight.
3. No guard turns when he goes to other direction.
4. Tiles on which he walks gets stuck (game would be assuming he is dead and that's why the tile is stuck...)
5. Even though he has sword or doesn't have sword, there is no combat.
6. The killing objects, such as spikes or chompers (the complete stuck ones) or if a tile falls on Prince or if there's no route ahead, the Prince dies in this case.
7. The game continues next level even though the Prince is dead and keeps on going ahead the direction he is facing. (Well, I didn't expect this one to be honest!

Any more things left to mention?
P.S: The room into which he falls is Room 23 (Special Event: Load Level 12b if Prince gets to Room 23).
P.S.S: Why were the color of the points were blue, same to the color of the FAT Guard? So the game takes points of the shadow and then applies the color image of whichever guard is in the level?