Due to the small foot print, I will convert the Pro Micro to 3.3v by replacing the regulator chip from 5V to 3.3V to avoid the voltage level shifter circuits. I plan to mount a daughter board on top of the pro micro for the 16 Mb serial flash.
Now figuring out ways to avoid damaging the 3.3V serial flash if you need to re-flash the boot loader. Seems the 5V USBasp programmer can be modified to program in 3.3V mode. That may be a solution. Thanks to @serisman. Alternatively I am testing if it’s ok not to take the 5V power supply from the USBasp and keep using the 3.3V battery during boot loader flashing. That will solve the VCC issue but the TTL voltage level of SCK, MISO, MOSI, Reset, will still reach 5V during programming. That may be too close to the absolute max limit of signaling voltage level of the serial flash (VCC +0.4 V) , VCC max 4.6 V
Here is the video: