The 1-UP Mushroom isn't really a power-up, in which it doesn't affect you, but it does add to your Life Total. Many are confused about the concept of death in the Star Earth, but having a 1-UP usually makes dying a little less troubling. Upon dying, you use an extra life and come back to life like you were before you died (without any power-up states or effects). If you run out of extra lives, the effects of the 1-UP could still bring you back in the way a Game Over would in a video game, so it's good to have these if you don't want your last moments to be falling down a random lava pit.