After looking at the video, I can understand why you placed that lighter area around King Boo's body. It's not so much a highlight but rather a spectral glow around most of his body. To translate that into pixel art, though, I'm honestly not sure how you'll be able to pull it off without post-production effects.
As for the crown, even though it makes sense for the shading that is implied by King Boo's "highlights," I can agree that the previous crown looks better. To keep the previous crown, I would almost say that King Boo needs to be shaded from the front to allow the shading to make sense and look consistent, but I don't really want to give you too much to worry and unintentionally destroy the eerie image you're trying to capture here.
As for the crown, even though it makes sense for the shading that is implied by King Boo's "highlights," I can agree that the previous crown looks better. To keep the previous crown, I would almost say that King Boo needs to be shaded from the front to allow the shading to make sense and look consistent, but I don't really want to give you too much to worry and unintentionally destroy the eerie image you're trying to capture here.