Verified answer

you get a different ending if you finished collecting all the 120 stars, I'm not sure why the mushrooms still say the princess is still trapped, it might be a glitch or something (it will never change). MAYBE. Not sure if collecting the 120 stars is worth it, but I copy/pasted the difference between the two endings below.

From Gamefaq's website:

Beat Bowser with between 70 and 119 stars:

Bowser lies on his back in the middle of the arena.

Bowser: Nooo! It can't be! You've really beaten me, Mario?!! I gave

those troops Power, but now it's fading away! Arrggghh! I

can see peace returning to the world! I can't stand it!

Hmmm . . . It's not over yet . . . C'mon troops! Let's

watch the ending together! Bwa ha ha!

Bowser fades away, and a giant star appears in his place. Mario

grabs the star and gets a wing cap. He flies off into the distance.

Mario lands on the bridge in front of the castle and the wing cap

disappears. Mario looks up and sees the star in front of Peach's

stained glass window turn into Peach. She floats down, and lands

between two Mushroom Retainers. Mario, taking off his hat and

holding it in front of him, runs up to her. She opens her eyes and

looks at him.

Peach: Mario! The power of the stars is restored to the

castle. . . and it's all thanks to you! Thank you, Mario!

We have something special for you!

Peach leans down and kisses him on the nose. Mario jumps up and

puts on his hat.

Mario: Here we go!

Peach: Listen, everybody! Let's bake a delicious cake . . . for

Mario.

Peach and the two Mushroom Retainers walk inside. Mario looks up

at the sky.

Peach: Mario!

Mario runs inside. The screen pans up, showing several birds

flying away. The credits appear, along with cameras going around

the different levels. After the credits, Mario and Peach, between

the two Mushroom Retainers, wave goodbye. Lakitu comes down

and flies overhead as the screen fades. The screen

shows a cake, with Peach and Mario at the top, and candy bar

saying "Thank You" and a tea set surrounding it. It says "The End"

at the bottom of the screen.

Mario: Thank you so much for-a playing my game.

Beat Bowser with 120 stars:

The only difference between the two endings is what Bowser says

after being beaten.

Bowser lies on his back in the middle of the arena.

Bowser: Noooo! You've really beaten me this time, Mario! I can't

stand losing to you! My troops . . . worthless! They've

turned over all the Power Stars! What?! There are 120

in all??? Amazing! There were some in the castle that I

missed??!! Now I see peace returning to the world . . .

Oooo! I really hate that! I can't watch-I'm outta

here! Just you wait until next time. Until then,

keep that Control Stick smokin'! Bwaa ha ha!