I've been a lurker on these forums for awhile now, because I love seeing how WIPs change over the course of a post. I'm still learning about the ins and outs of pixel art, so I can't help you with banding or noise or anything, but I can certainly help you here - you've got some anatomy issues.

 

A wireframe is a way to model the anatomy of the form you're drawing before you put skin or clothes on. It's like you're drawing a simplified skeleton, and in this case, a skeleton with the shapes of different basic body parts on top. They can be as simple as glorified stick figures, but the point is that they help you see how the character is moving. Mine has lines on top of some of the sections - these show what direction each part of the body is facing, which really helps when tweaking the body and adding clothes on.

 

Assumption: You're making a character sprite that faces SW. If I'm wrong, ignore all this.

 

The body you had before was okay, but when you tried to make it iso, some scary things happened. The first picture is your original, and the second is a wireframe I put on top of it. I'm pretty sure you meant this to be an idle pose, but it looks like she's trying to roll her shoulders - her left shoulder is way too high in comparison to where her head is and it pushes her chest forward. Her upper body is sort of facing in the correct direction, while her lower body is still facing forward. The straightness of the bottom of her shirt and the top of her pants makes her hips look flat. Her feet are actually on the right line, but her entire body needs to shift with them, because it's making her left leg too short (and slightly bovine). Her knees seem to be in ambiguous places and her right arm is bent strangely.

 

 

In the third image, the purple lines are actual iso lines, while the dark reddish ones are the way different parts of your character are facing. In true iso, all these lines would be (for the most part) parallel. The first red line is the line of her eyes, the second is the line of her chest, the third her stomach, the fourth her hips, and the fifth her knees. I didn't include one for her feet because they're in the right place.

 

Nitpick: Increase the contrast on the skin on her arms. When I look at her from the wrong angle, the shading beneath the sleeves make them seem to disappear, Rayman-style.

 

{I'll continue this post in a bit}

@jalonso: I swear, that is what everyone on the internet hopes to hear at some point. You have made my life complete! :D

 

And here are some screenies to illustrate the point about facings in isometric views. Final Fantasy Tactics: Advance is a great isometric game, and you can see how all the characters are facing either NE/NW/SE/SW, and not just their heads but their entire bodies. The direction a character faces in FFTA is extremely important, because an enemy that isn't facing you is 25% easier to hit.

 

 

Not really sure what game this is, but again, you can see how the body is facing one of the secondary directions and the head is facing the same direction as the body. The mole knight is facing west, but I assume this is a cutscene or something.

 

 

One of the challenges with drawing people in an isometric environment is to keep them from looking too blocky. Example:

 

 

With some of the people here, you can really tell - the arms and legs are very straight. (And why is that kid about to jump off the roof?) So if you stick with an iso world, you have to decide if you want it to look like iso #3, where you can really tell it's isometric and things sort of look like blocks, or iso #2, where it's the defining point of the art but not the first thing you think about, or iso #1, where the characters are all sprited small in the game world to make them easier to manipulate.

Ask, and ye shall receive. This is why I assumed he was a lady:

 

 

Note about fabulous hips: You don't seem belligerent, but some people might say, "But I wanted him to have those fabulous hips! He's a girly man!" At that point, you have to decide whether it's more important to you for him to look as girly as humanly possible, or if it's more important for your players to understand they're playing a guy.

 

Also, the dark blob on his shirt isn't exactly realistic. Even in very dark areas, there's still reflected light all over the place - even if there's only one lamp in a room, the light from that lamp bounces off every wall it hits and will get to the left side of his stomach.

Well, that's because from this angle you can see more of him, mainly his neckline and a peek at the top of his back, because iso is a partially top-down perspective. Did some quick edits, I think I might be showing too much of the back of his neck, but you get the idea:

 

But ZOMG what an improvement on your last one! :D Great edits on the shirt, I can tell he has elbows and that he aint a lady. *encouragement!*

 

Also, .PNG is the god of filetypes. I'm using photobucket for everything, so you can't tell me it's not taking .PNGs. :P