OK - My tuppenceworth.
Depends on how shiny and eye candy it is. Plain background (as in the olde game) just check the pixels you are about to blit to are zero or background colour. Allows the baddies to move sideways onto a missile and get blown rather than just checking the forward point of the missile.
Should be able to check the x,y of the missile against the xy of baddies to work out which one shot (don't need to make each one a different colour).
There were a couple of tutorials around on collision routines (at least at sweet.oblivion) so I assume they should have been moved here?