1) I do not have as many options within mamewah. I had 6 options before including "misc options" that had 10 sub-options. one of those options was "keep image aspect ratio" that will lead to my question number 2. Overall i have noticed that i have a very limited number of options. Another example, is the number of filtered gamelists.... i would have like 50 or whatever, that i could modify within mamewhah, now i only see the unfiltered mame list. I was able to add more lists using mamewah config, but did mamewah 1.61 lose the detailed options that it had before in the earlier versions or is this simply a result of using mamewah config during initial setup?? I used the default mame config when setting up mame.
Most of the options from the menu have migrated to within some config (ini) files. Basically forget what you know from earlier versions, most has changed. Read the docs (\mamewah\docs\) and you'll see what I mean

2) Using various layouts that have overlapping graphics (such as overlapping mspacman and mario in the scrrenshot portion of the John Crouse layout), is there a way to have the layout OVERLAP the screenshot? I noticied this is a problem now that 1.61 and my mamewah config program seems to have defaulted to a "stretch" aspect ratio for the screenshots that i cant turn off because of item #1 above.
Not sure what you mean really...but basically no, the layout background image cannot overlap the screenshot, and never has been able to. The aspect ratio option is now in the ini file(s) so you should be able to set that as before.
PS - Is there a resource (other than the built-in help file) for mamewah config somewhere? After the initial setup the options for configuring seem limited, with initial setup settings no longer available?
See the links here:
http://mamewah.mameworld.net/help.htmand thanks to the author of Mamewah! 
No problemo
