Large eyes and softer features evoke childishness and innocence, which is something you definitely don't want for your villain (unless you're purposely subverting the rule of thumb). If you look at Disney movies, every major villain possesses sharp features, even large characters like Ursula.
Exactly. ^_^ Younger, more innocent characters (and, erm, curvacious women xD) use circles in their design, heroes and tough guys use squares, and villains use sharp triangles. Combining more than one can add more depth to the character as well; Bowser, for example, has sharp triangular spikes and teeth but has a body that's mostly made up of circles, which is telling of his habit of switching between villain and playable character.
Thoughts on how I could make this better?
Ooh, I like. ^_^ Though, it does kinda look like he's dancing a jig in place. How about making his body bob up and down 1 pixel?