Fixed it a little.. But I'm still having problems with the shading, dammit. The part around his mouth looks like shit, I'm stuck.

I can easily see this guy as some sort of enemy in an arcade shooter similar to Centipede, or in a side scroller if you anchored him from the base of his neck and made his head move back and forth. I'd also give him a bit more detail in the mouth parts, perhaps make the mandibles snap open and shut, maybe make him blink too.