An idea I just came up with while changing the bakcground could be if you could make it change as the player is proceeding in some kind of story line. För exampel:
You could make an ordinary story line in which the player is chasing a bad guy who's hideout is in "the darkest edges of space". Therefore, you could add some threatning elements into the scrolling background that's reflecting the place the player currently is in. It could start as it is now, but later you could add some particles wich is flying around, some lighting effect, and maybe some space stations or so. Keep that in mind, some elements
This could be a boss, maybe? Maybe a second, one? I just thought it would be nice with a cockpit.
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(Hope it'll look as good in the topic as when I wrote it)
The idea you had about destroying different parts of the boss sounded nice, you should do so! But, don't make the boss to hard!
I remeberd reading an E-book once in the way to make an enjoyable game, it said what to do and not to do. Don't know what its name was, but a golden rule it mentioned was: "A loss should always be a result of a mistake the player comitted, not the game itself!". You could make an almight boss with big exploding things that's shooing bullets all over the place, but maybe that's TOO difficult to handel? It could suit a player later in the game, though.
And what to name you game?... Hmm... I always to give my own games a name that has nothing to do with tha game itself and that's just nonsense. Like my latest game "Durado"
http://forum.thegamecreators.com/?m=forum_view&t=68230&b=5
But to give you some options in what to call your game, that I thinks sounds rather good

"ASC-fighter"
"Symbolicus"
"Steer a ship made by a letter trhough letters and kill letters with your own letter"

I don't think you should involve some roman numbers in the titels, though. That can be mistaken for the a sequal
Geez, I'm writing a lot! Hope it all make sense. Maybe I should try to re-write that book I read... Could be fun, and usefull for you. You don't happend to know that book I'm speaking about?
www.godhatessweden.com
Good laughter!