A Poison Mushroom is easily accessible, and should be avoided.
Create a platform to the real Power-Up in the ceiling by revealing two hidden Coin Blocks. For a Mushroom, you need to make it rebound by hitting the right brick.
It's a real challenge to get coins or a Power-up in this Coin Room. If you are super-sized, you can break through the bricks for a Fire Flower. If you are Luigi, you can jump from the right without dashing for either Power-up.
But if you are regular-sized Mario, you will need to dash right and jump left from the pipe.
Either way if you are small, it will be a Mushroom and you will need to make it rebound by hitting the right brick.
Swim around and grab the coins, but try not to get cornered by the Bloopers or the Buzzy Beetles. If you are Fire Mario, you can blast the Bloopers away.
You can not jump on or even use fireballs against the Buzzy Beetles. You can only swim over them.
Make sure the Blooper guarding the exit pipe doesn't chase you into the pit.
In the original game, this area has a 50 coin potential. However, in All-Stars - The Lost Levels, the last 16 coins are missing. Fortunately, there is actually ground underneath instead of a whirlpool drain.
Be careful around the Koopa and the Bloopers. Once again, avoid being cornered or chased into a pit, and if you have a Fire Flower, use it.
When you reach the exit, wait for the Koopa Paratroopa to float down toward the pit, or blast it with fireballs.
Don't fall, or you will lose a life. Stock up on all 17 coins. If the Warp Zone backtracks to an earlier level, there is no suicide pit. Just wait for the time to run out.