Hey I worked on it a bit more but didn't post the results before I left the house.
My equation was a tad off. Ex 0.5*sin(angle)^2 needs to be (0.5*sin(angle)^2.
Other than that the sprite's angle needs to be corrected to eliminate the bounce.
Set angle to angle(0,0,cos(ang),0.5*sin(ang))
The only caveat is the Sprite won't be pointing at the mouse anymore. I was working on the math to just find the intersection between the ellipse and the line to the mouse but I didn't finish.
If you want indavidual X y scaling of layers just use the paster object. It doesn't need webgl.