Damn, I always let secret santa pass by, I was gonna enter this year but totally forgot. I'm guessing it's too late if the PMs already went out.

Well, hue shifting is not inherently a bad thing. Like all techniques, it's utility depends on moderation and application. Overusing any tech can be detrimental. Art doesn't always have to be the replication of nature either. Style of course comes into play as well as the goal of the artist. Sometimes making things hyper real (or cartoony on the other end of the spectrum) can be more aesthetically interesting than something that's a deadpan imitation/representation.

Connecting back to the main topic, I think there is an important distinction that hasn't been brought up yet about comparing the games. The golden age of SNES games, beautiful as they are, were experienced on CRT monitors, also at varying resolutions depending on what size tv. ("Like a 20 inch Zenith you gotta see it to believe it") They wouldn't have had the crisp picture that keeps the integrity of the pixels intact. The colors bleed into each other. This is why the bitmap brothers got away with crazy dithering/ramps, they looked totally smooth viewed on what it was intended to be experienced on, CRTs. We take the sharpness of LCDs for granted. It may help account for the disparity.

Also we should remember that in the large schema of art, pixel art is relatively esoteric, not everyone will be able to appreciate its greatness, as is true for any type of art.

This is a good topic but the main thing that concerns me about the experiment is that you were photoshop blurring LttP and SD3 screens? Imagine putting a blur filter over the mona lisa, it's no wonder they thought it looked awful. There's no doubt that even the old pixel masters 'could have' been better. (A lot of CT screens have priority/readability issues) but the greater picture is that they invented a lot of the techniques that we use and learn today, and established a precedent so strong, that people are still creating pixel art 20 years later.

With the whole resolution and new = better thing. I think there is a new nostalgic based resurgence of 2D pixel based games. It's just that with them, there are a bunch of stereotypes about what pixel art/that retro look is. Look at the penny arcade game for example, they're reffing FFVI graphical tropes but missing something in translation during the process. It's also perpetuated by those youtubes of popular TV shows turned into pixeled RPGs like Breaking Bad or Game of Thrones. (Also that one Community episode) Pixel art is fashionable and cool again but it's a double edged sword because of how pixel art changes what it conveys. (From being the standard for video game graphics in early 90s to something romantic and nostalgic; intertwined with fond memories of the past instead of being its own entity that has flourished and evolved away from and with game art)

Hard finding refs but working through this:

Liking the BG developments, maybe his face is still a bit off? Better than previous iteration but still tweaking.
face ref:
http://www.allposters.co.uk/-sp/Face-of-a-Woman-with-Ruffled-Hair-Looking-Down-Posters_i2546096_.htm
pose ref:

Also, I accidentally saved and started working in the smaller res version without knowing. Trying to reconstruct the orig res, but should I continue work on that one or the smaller version? (which is the size I posted here and has the layer integrity intact.) I could also upres the smaller version and paint over it, but is this worth it if I just scale it back down at the end?

Hm, alright it was meant to look like his eyes were closed, not just looking down. Here's a quick edit that shows him with eyes.

The looking off screen thing is a good tech, always brings me back to that Blade Runner poster, which is a good thing. 2nd one is me playing with placement.

@Liksmaskaren
Really cool edit, a lot more evocative of those samurai refs I posted. I like the suggested action, unsure about the placement despite employing rule of thirds. Will experiment further and post results.