2d toolkit doesn't have any features to make this easier directly, but could make the 2d atlas management, etc a lot simpler.
What games like that (and resident evil, etc) do is they have a painted z-buffer for each frame. Basically you need to tell it whats in front of others. Then you just move your sprites in 3d space, and they automatically go in front of and behind other objects. With this method you can have layers too, so you can have nicely soft edges going in front and behind other objects seamlessly.