Your problem is that you lack the 3D shape of a lighter but still try to illuminate it like it was 3D. (And a pillow-shaped 3D object at that.) [Note: Not pillow shaded, pillow-shaped. Okay, maybe a little pillow shaded. More of an off-center pillow shading I guess. Ignore this rambling bit.] I suggest rotating the thing a bit in your head and drawing it from an angle. Isometric pixel art is quite good for this sort of thing, but you might want to also try your own angle and get a fresher start on things than isometric; I notice a lot of iso PA is very blocky because it's so clean and defined. Go for a view with some perspective shown, I say. Then shade the sides like the brushed metal/etc. you have here, paying attention to their orientation relative to the lightsource. I quite like the texture on the second one for a very matte metal but I think you would do better for a more high-contrast color scheme here, after you get the shape and the like down. Good luck with your art!  

Edited by Monkey 'o Doom - 25 October 2007 at 7:17pm

Either way works, though you really don't have too much space on the edges to work with on the left one and the right seems a bit thin and overly curved compared to the reference and zippo(e?)s I've seen. All your WIP images here so far seem just a bit out of proportion in that they're a bit compressed horizontally. Give them a few pixels more width.