Labyrinth Quest, Update 1.1, is being released on Saturday, October 27th. Additionally, here's the full changelog for the update as of right now:

• Completely new level file format, with a lot of new features for custom levels:
  • Rotatable Special Tiles and Walls
  • Can set the background color of the level
  • You can set the color of keys and key doors to whatever you want, and key doors can only be opened with keys of the same color
    • All the previous colors of keys and key doors are presets in the color editor window
    • 3 new preset colors: Light Blue, Gray, and Brown
    • Green key color changed to a softer, lighter shade
  • Colored dynamite - Like keys, only works with Dynamite Walls of the same color
    • Comes with 10 color presets
  • You can modify the color of cobwebs
  • You can modify the color of guards and warriors
  • Ability to set independent variants of walls and mines (such as fire walls, aqua walls, etc.):
    • Two new variants of wall: Bush and Ice Wall (perhaps some new levels in the future...?)
    • New variant of the mine: Ice mine
  • Ability to modify the particles of a level
  • Ability  to set level effects (underwater, fire damage, etc.)
  • Ability to add a river, lava river, River Lethe, or ravine with the bridge already installed (for decorational purposes)
  • Right clicking opens a dropdown that allows you to modify the properties of a cell (the previously mentioned color, rotation, variant, etc.)
  • Three tools in the level editor: Place, Delete, and Override
  • Levels stored in the old format can still be loaded in the new format
  • You can no longer use bosses in custom levels
• Decorations
  • Decorations (skulls, broken tools, flowers, etc.) will be spread out in levels
  • This is random, and decorations have a chance to appear in any cell that isn't occupied
• Issues:
  • Issue #1: When saving user in settings, the user can't save unless they change their username since a user with that name already exists
  • Issue #2: Items are the incorrect size in the Level Editor
  • Issue #3: Crash after completing last treasure level 
  • Issue #4: Explosions don't damage the player
  • Issue #5: Very rare bug where taking damage freezes the player

Screenshot of the possibilities with the new level editor:

This is a dynamic post and will be changed to provide new information about the update.