I forgot to change the 'btnp' to 'btn' before publishing this but theres still collision issues.

This is a problem that comes up a lot. The method you're using for collision detection only works for grid-aligned movement. If you switch to smooth movement, then your check for collisions only applies to the top-left corner of your character.

The quickest change to your code to fix it would be to change this line

        if(can_move(newx,newy)) then

to this

	if(can_move(newx,newy) and
	   can_move(newx+.875,newy) and
	   can_move(newx,newy+.875) and
	   can_move(newx+.875,newy+.875)) then

To explain, .875 is 1 pixel less than a full tile, as measured in tiles. As such, the other 3 calls to can_move check the other 3 corners of your character.