Thanks!
Yeah, backgrounds are just a single model copied three times and teleporting back up as soon as it scrolls beyond a certain point. Pretty much the same way you'd do a 2D scrolling background, I guess.
Shooting down bullets wasn't intended at first, but then I noticed the game started becoming too hard without that ability, so I put it back in.
In hindsight, I should've made at least two types of projectiles, ones that can be shot down and would move slower, and ones that can't. Games like Darius do this sort of stuff.