For most people, especially with MESS, it's about preserving and emulating the game play experience. Just like the artwork on the label of a 2600 game cartridge never represents the actual game play, what ever is printed on the back of the box should just be 'box art'. Replicate the LCD exactly as it sits in the game. That being said, with MESS you can do whatever you want. You can have an overlay, underlay, transparency layer, texture layer (like the screen of a CRT or something). For the LCD games, you should make a clear scan (if possible) or high-res photo of the artwork behind the LCD uncovered. The LCD sprites will be put in place by MESS, and the artwork can be 'darkened' by adding a polarizing filter layer to it (that's what those two dark pieces of plastic are, they make the LCD visible. Tinting is just a side-effect...). That's all very easy to do. And, if someone wants, they can turn of the darkening layer, and even swap out the background with the scanned box art (or any image they want). You can make the characters in the LCD full-color... Hell, they could be photographs of actual people in costume if someone really wanted to go that far... (Which would actually be kind of fun to do, now that I think about it... ) Scan and photograph everything, it can all be put to use somewhere... You can never preserve too much.
So much done. What image format should I make the images to be compatible with MESS/MAME. The pallet project is next after all this scanning. I have over 200GB but this should chance when everything is scaled down and converted. I do have other concerns like VRT-X games have a hologram how is this captured how is this reproduced. I know for a fact that its been done on a futurepinball game that had a working hologram reproduced.
I have yet to get a Tiger R video game system.It works just like the virtual boy and is a ripoff of it however I like it better for some reason.