Background from Sutte Hakkun. Not a full shot of it, the full background can't be displayed at any one time in game due to being bigger than the dimensions of a single screen, and the in game screenshot field doesn't allow big enough images to show all of it.
It's basically a Christmas themed background. Perfect for ice levels or sky levels with a Christmas theme. You know, the background which carol should have used for the level with evil Santa:
http://www.youtube.com/watch?v=XT0b0GDvlhE
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As for Mario's Nightmare Quest? Well, it's currently on Fusion Gameworks, ROM Hacking.net or the GCN at the moment.