Cartoon movie from the 80s (I think)

OK so I used to watch this movie in the late 80s when I was a kid and can only remember a few bits, but it’s killing me to know what it was.  Hopefully someone can help!

 

So it was an animated movie about some quest with anamorphic characters.  The main thing I remember is from near the end.  The hero(s?) are fighting the bad guy and the villain fights back with some kind of magic that turns people into blocks.  I remember a lion like character who gets turned to blocks during the fight.

 

Am I crazy or is this a real movie?  Tia!

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