The dithering is bad mainly because I didn't have too much time left for submitting the picture for the challenge. And that's how unfinished "intuition" dithering looks like in my case. Probably hard edges would be better and easier. Tried to make Dug fluffy, and here we've got the results :P. I've realised I still have some issues with dithering. For now the question is when to stop and which pattern to choose.

awhh

Looks like the spray can tool. I think it'd look nicer with just hard edges for the light, maybe a bit of falloff. The dithering on the dog also makes the shadows too soft imo.

The concept is really nice, but I think you've overused dithering, as the piece looks messy from all the stray pixels.