I've been testing this out. It is very playable. The music occasionally skips, but if you turn off the music, the game seems to play pretty much perfect. There is support for saving to the vmu as well. This is pretty awesome. I would love to get a printed cover/insert for this.
A commenter in the dcemulation thread says it crashed for him at a particular point, but I have played beyond that point without any crashes at all.
Here's a fan page with info about the game in case anyone is unfamiliar with it. The game may look simple in still shots, but it has tremendous depth. http://www.cavestory.org/info_about.php