Your latest edit is a big step in the right direction IMO, but I would even take it a step further. Here's a quick edit where you can see the general idea I have of the shading/texturing style I think you should use. Granted, the scales don't look perfect but you can easily tweak that while retaining the style:
<mine>...<yours>
I think you're still focusing a bit too much on keeping that nice scaly texture while not paying attention to the form of the arm. Remember that you can still convey a texture very well by merely using strategically placed colors, it's one of the nice things about pixel art. You can always hint at a certain texture without going "outline outline outline" and trying to draw each individual scale like this: [][][]. Remember your pallette is trying to suggest form as well as texture. In order to convey form well, keep colors generally where they're supposed to be; Don't bring the darker green very far at all into the purple, for example. But to convey the scaly texture well, you should bring some colors where they're not supposed to be, albeit in very specific, deliberate places. I don't really know of a good example of what I mean, so I'm going to be somewhat vain and use a simple example from my own portfolio:
Now, this is more simple (only 5 colors) than you want your reptile to be, but hopefully it illustrates that texture can be easily produced by doing little more than hinting at it using colors.
