Whenever you switch from the dolphin to the seagull or vice versa, you will get an additional 10 points of health. So keep switching back and forth to get as much health as needed.
Release the mermaid on Level 2 but swim up and leave before her cage is fully open. Transform into a seagull and fly to the letft or right of a volcano. The programmers' initials will form the volcanoes.
After releasing the mermaid the 7th time Imagic's address will appear at the bottom of the screen.