Toad

[Zee]

As you can see my shading/outlining skills suck terribly

For such a small sprite I would say stick to fewer colors, maybe along the lines of... 6 [4 sprite colors, black outline, and background color]

Don't try to shade such a small piece, work on making it look good first. Play with the lineart. The bottoms of shoots are not rounded, arms are not L-blocks, work on rounding out the mushroom hat a bit more, and try playing with the red spots until they bend with the percieved curves of the hat.