Short version: Are original covers of existing video game songs allowed?
Long version: In the game I'm working on, I use background music that I made by taking this song from the Celeste OST, finding a transcription into virtual sheet music that someone made, simplifying it by removing all but the main instruments, converting that MIDI into a format used by the Nintendo 64 to process audio, rendering/synthesizing audio using that track and one of the SM64 soundfonts, and recording the resulting emulated audio back into a normal audio file.
The result of this process is an audio file that does not contain any part of the original audio from the OST as it was generated purely from a sequence file of notes, but it does of course have the same melody (within a margin of error) as the original song.
Is this use acceptable or does that still count as copyrighted element?