No, the projectors on Forbidden Journey are attached to the screens. The scenes that have motion blur have it because it was digitally added; you can tell in certain parts of the film. With the wide-angle aspect, yes, but I think these are quite special projectors that, in the end, do their job. However, if brighter projectors were used, their reflections could deter from the lighting schemes of the surrounding sets.
I propose for the ride film to lose the motion blur. New projectors could help, but I think raising the film's brightness could also have the same effect. In respect, the scenes would then be re-lit and reconfigured to better suit the theme. For example, the raging storm in the Forest can easily be replaced with a quiet and subtly scary spider scene, without the need for flashing lights. The climax of this scene would be Hermione casting her Arania Exumai, and then being led to the Willow with a more picturesque intro (and a huge domed backdrop - please). Then, with more black curtains, the transition into the dome would be easier to manage.