Make more items, dungeons, quests, and that you add in leveling up.
You should add in items such as a trap door, transportation, and party blocks to start with. I think the most important thing to add in is leveling up, so that people can have more than 3 maximum health and fight stronger foes. You should also add in more quests that require going into certain dungeons, I had an idea for the first one which has beetle foes. The dungeon would look very old and have moss, vines, cobweb, and cracked stone everywhere, the first enemies I thought of would be called baby beetles and would be weak and able to fly. The second foe would be bass beetle and would have a trumpet that makes you go to sleep for a second, its attacks are slow but strong and get even slower for a while after playing the flute, the attacks can be dodged by getting out of the way of the notes. The final foe would be boss beetle and would be very big and strong, with fast attacks and could spawn other beetles by laying fast-hatching eggs, he would throw rocks at you, and would have a pattern as in other games that by using the patterns to your advantage you can dodge attacks and hit him in the right spot. Leveling up would have skill points that some would be auto set and some can be set by the player, for a price, there would be an item you would have to buy every 3 levels to set your skill points, and it costs way more to buy an item to reset all of them.
I added a leveling system today, check it out! http://blog.8bitmmo.net/2013/07/leveling-system-added/
Bret Wade commented
I'm SO confused, Sim
why would you want new players to be competitive against old players? In that case, what's the point of being an old player?
There's a reason there are leveling systems in every other game.
I forgot to register here lol, my username in the game is barefoot138