That's a hardware limitation of the SNES. Only so many sprites can be displayed on a horizontal line at a given time, so if too many numbers are popping out of things from being hit, it'll cause that flicker. SNES9x includes the sprite flicker for accuracy.

Not as far as I can find in the config file. The idea is to have fast emulation that is as accurate as possible, so that SNES9x doesn't have to include a bunch of weird hacks to get specific games to run. Chances are there are some games that depend on that sprite flicker for pseudo-transparency, so if we removed it, those games wouldn't look right.