how do I make Engine glow for ships

The simplest way to do it is with layers and toggling visibility. You can create either a new object for the glows, or do it with particle effects (it makes the glow look a bit cooler, but can sometimes have sketchy results.) I'm not sure how Blender does with creating cloudy effects like engine exhaust, but I'm sure it can be done. Create your engine glow in a second layer, then render an animation like you did with the sprite itself, only with the engine glow layer toggled on and the sprite layer toggled off. You can do the same for weapons sprites and shields, if you feel up to the challenge.

The way I do it is to have the engine glow texture be emissive and the engine glow itself attached to my ship model. When I make the engine glow I turn off all the scene lights so that the only thing you can see is the engine glow, then I render out the movie of the ship rotating as I normally would.

With the lights turned off you'll only be able to see the ship, but the ship is still present and will "clip" the engine glow so that it fits with the ship in game.