Welcome to Pixelation.
Thought some questions might be answered in an edit:
I have applied dithering and AA to your lines using the same amount of colours you have in your list. The contrast has been increased to make more use of each colour, and to make the overall character more visible. Note the AA around the eyes and how you can very the length, shape and impact of a shape by using different degrees of light and dark shades. The outlines have been smoothed out in the same way, with the outline colour changing with the lightsource, sometimes merging all together given what effect you want to achieve. For larger areas I've used dithering, but it also shows how you can blend dithering and hard-edged shadows.
If you're looking for tutorials on techniques, I suggest you check out this thread:
http://www.wayofthepixel.net/pixelation/index.php?topic=222.0Happy pixeling.