To hear different hit sounds for Mokujin, hold DOWN on the D-Pad or joystick before a match in which you are controlling him. When playing arcade mode simply quit the match before you lose the second round and you won't get a demotion or lose any experience. Collect it and continue to beat Stage 4 to unlock Star Blade. There will be a spaceship from Star Blade in the middle of the room. Jump over the tiles and move on to the next room. There will be some tiles appear after the wall is destroyed. Transform to Devil Jin and press L1+Square to blast at the wall. Go to the first room in Stage 4-2, there is a breakable wall underneath the higher ledge.
You have to unlock Star Blade from Devil Within. Beat Devil Within once to unlock the stage select feature.
