With regards to the first challenge, "Stick to the grid the tilesheet provided states (8x8, 6x8, 5x5, etc.)", what exactly needs to stick to the grid?
Due to the overall vibe I'm getting from the rules, I'll assume a single tilemapped background with sprites overlaid.

That being said, it seems clear that "sticking to the grid" would mean that background tiles must be laid out in an 8x8 (for example) grid on the tilemap, without any offsets or overlapping. But does it also mean that to be eligible for this challenge that we can't scroll the whole background tilemap smoothly, but only in 8 pixel (again, for example) increments?

And should sprites "hop" from tile position to tile position (almost not really sprites any more), or can they move smoothly between tile positions but only "rest" on 8 pixel (e.g.) boundaries, or are they free to roam smoothly over the entire screen?

Due to the proposed 1-bit nature of the tileset and the second challenge, I'm thinking in terms of the ZX Spectrum. :)