Ah ok, it seems like a bunch of people already replied while I thought about what to write and made some tea, so there's some redundancy in the following, hope it helps anyway    

Local colour has couple of connotations perhaps; obviously everything is in fact affected by lighting or you wouldn't be seeing it! So that's poor wording but I mean to say 'native' colour; that which you know the object to be under neutral conditions (moderate white light) or intend for the object to be (like a material colour or texture map in 3d software before being lit). The local colour might well not even be present in a lighting scheme if it's not well lit or the source(s) are colourised (like a photographic colour cast), but it's most likely to be truest away from extremes, and on the lit side.

In a sprite you might want a clear colour read in multiple contexts or at low detail so you don't want to be too far removed from the local, and the reference is not a good model for that. I mention it also because you had some long ramps with a lot of one colour (with some very high saturation that can appear 'naive'), or that added white in some WIPs, and you mentioned wanting to discuss theory earlier, not because I thought you weren't making progress.

Highs, lows, the 'key: yep.

Aside from being a pain to animate a reliance on rim-lights is much the same as a reliance on linework in that it's often making up for a shortfall of the underlying form; it's not that lines are bad practice: they're great and more rapid for many things, I love 'em, it's that for the work I've seen of yours, I think that that process for you at the moment is prioritising the wrong stuff, keeping you fixed in a 2D mindset.

Whether the outline is neat and accurate to the ref is not important when that's all you've got done, what's most important is the mass of the form; if you zoom out and squint at both ref and WIP they should look right; you want to approximate the broadest, simplest stuff first so you aren't dealing with everything at once and can stop at any point and either you or any audience will have a good sense of what's going on and what the finish might be like.

Actually just the process of constantly reproducing other 2d images closely is not helpful because it's not requiring you to think in terms of design (how an impartial audience will see something) or of form and light, and this is what I've seen mentioned in some of your other threads, and why I suggest making the effort to practice by ditching lines altogether and drawing from life.
 

This is a pretty interesting topic of material/reflective qualities, just hopefully clarifying what Tapsu was noting with some examples:

The collective highlights on hair as a mass are extended linearly either side of it's position on any underlying smooth form (and so forming the crescent) by the highlight position of many separate strands (essentially cylinders); the same effect is more apparent in the elongated reflections created by choppy water with the crest of each wave adding a separate component reflection. This is pretty much what underpins how diffuse any surface is only usually it's on a smaller scale (and without the directionality) but it's more appreciable (and interesting) here.

I'll have a quick doodle on the sprite in a minute, just wanted to chime in on the material stuff . 

Hey! Thanks guys

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I am quite pleased with the grey flesh, I like the way it brings out his nipples.

Mr Fahrenheit:
Frazetta and corny retro-fantasy stuff yes! Even a bit ‘Fighting Fantasy’ maybe.

Ryumaru:
I’m been a bit stuck on the tiles actually, to follow the original in the dungeon areas I’d have to go without variants, and most patterns in that palette quite quickly become intrusive. I have already strayed with (just-about) animated sprites though, and I’ve no plans to try and make this playable at all, at least not right now, so probably I should go in for proper tilework, should be fun!

Chris2balls:
Liking the solidity of your female edit thanks, and the black too which really surprised me, original looks a bit skinny compared. I took another pass on a compromise. I know contrast is an issue and full outlines would make sense as 9_6 demoed also… but my ever so artistic vision, it leads me a different path . Did you see the newer greyshade version for the male char?




(I'll have to redraw this one for the animation, so I'll beef it up with more black then)

There will be more! I was caught off guard a bit by this late interest, I should’ve had more work to update. It's fair to say I’m losing momentum a bit, I’ve considered sticking with static sprites ‘cos trying to make the limited animations work is what’s taking time and discouraging me from knocking a few out whenever I have opportunity. I’ll persevere with them for the moment ‘cos it’s been educational, and I think that kind of visual feedback would have improved the game a lot; the only indication of any hand-to-hand combat is the status bar which can make for some rapid and confusing deaths early on.

Looks ace! but howja mean 'from the genesis game' are some elements taken directly or remade, what are we critiquing?

Why bothering in 2014 project-wise with that dead military perspective, which is outdated since several years.

I think that’s pretty close minded; why use 'outdated' pixelart This is oblique projection and 45° lines are pretty crisp? There are definitely advantages to this approach too imo, particularly to do with clarity and tiling that I don’t really want to go into but I dunno why this is a issue.

I'm a bit tired to give a full crit, sorry, but those rocks are very repetitive in size and shape, almost arranged in rows, the weapons look nice and in style with Ultima... I mean Tibia.