Yeah, this was fun to solve.
Re: 2, it seems intentional when two occupy the same space, 1 of them gets priority and has to be moved first? Ideally, you could pick which 1 of the 2 you could move, but removing this choice makes the puzzle harder.
Re: 3, I don't like the flashing lights/colors at all. Putting a "You win" or "Congrats" <div> somewhere prominent on the page is probably enough. Flashing colors is very painful on the eyes.