Help Wanted: Apples Within

[Chris2Balls [:B]]

A consistent issue I have with your sprites is the contrast. The dithering just makes it worse in my opinion.
Your shading is banded, so despite the light source being from the side, it still looks flat, especially as you don't take into account the volumes you're trying to suggest.

So I've reduced the contrast, added buffer shades, tried suggesting the volumes, and getting a vaporous/smoky effect for the cloud (your version sits somewhere between realistic and stylised and doesn't work in my eyes, which is also due to the banded shading which disregards the volumes of the cloud). I suggest you use references for the cloud, the shading for the creature... it will help a lot.

Hope it helps, and keep going!