Awesome stuff man. Here a few ideas for you. Take or leave as you see fit.
With an action RPG game like this, attributes like strength, dexterity, are not as important as skills, speed, high-jump, double hit, etc. The standard 100 points health (10 hearts) would work just fine. One thing I did with
Escape from Lab 42 was to tie the combat effectiveness to the health bar. In Lab 42, as the health bar went down, the character became less effective. For this game you could tie damage done to enemies for example, or reduce the speed or jumping ability. This would make the player really have to pay attention to the health bar during the game. This could be implemented very simply by using a percentage value based on the current health, or have it kick in after 50% damage or something like that. What this essentially does is reduce the various attribute values down to a single attribute value which is easily managed.
For the main RPG elements I would develop a set of skills that the player could buy or upgrade using using XP or coins or whatever currency you are using in the game. You could implement an upgrade screen between levels so that the flow isn't interrupted during the game, and give the player something to do between levels. This could a linear progression or leveling up system, where the player can upgrade only when reaching certain amounts of XP. For this type of game, I would the second option as it adds tension to the game, especially if you display a progress bar showing the progress to the next level.
As far as skills, I would implement skill sets with various tiers associated with them. For example, jumping could come in two forms, jump I and II. Each level of jump would increase the height of the jump but would also cost more during use. This is a good way to group related skills together and gives the player character some progression in the game.
Also, skills should cost something when used; mana, energy, spirit, whatever you want to use, in order for the player to have to think about resource management. This is where these types of game fail, in my opinion. Players want to manage their character; it gives the game a strategic element and makes it more than just run and shoot. Also, not every skill should be available right off the bat. Role-playing is about progression and the sense of accomplishment the player receives when they level up.
Another area to look at is good item selection. Have a good mix of items, with a special item thrown in at boss levels or during mini-games. If the player is going to risk a lot, then they should be rewarded for the accomplishment. Of course, you will need items like health potions, or mana bottles during the game so that the player doesn't feel like a level is impossible, and a random epic is always good to throw in the game from time to time so long as it doesn't overbalance the game.
As mentioned, the fairy, or sidekick, could be an integral part of the game. Sidekicks can either make a game really fun, or ruin a game, so they have to be implemented with care. Being able to control the sidekick is an idea, but remember that the player character is just standing there during this time and it could end badly for the character if he is in a vulnerable position. This may prove more frustrating than helpful.
However, there are ways around this. You could give the sidekick orders, or simply become the sidekick at times, with the player character not even on the screen during this time. This needs to be used with care as well. If the sidekick-player dies, the character should revert back to the main character. The duration should be limited, maybe cost a certain amount of mana for a certain time. You don't want the player to play the game as the sidekick, just use the sidekick in special circumstances.
Anyway, just some ideas to get you started.
