I just realized, that I don't need to worry so much of the height of the sprite (in pixels).
All I need to worry is that the width don't exceed 32px.
Here is new test:
[ Show youtube player ]
I am much happier now.
Sprite is bigger, and now we can recognize it's shape, instead of those messy pixels in the last update.
1) I re-rendered sprite (tried to make lightning more in favor of the silhouette and shape).
2) Made new sprite sheet, and scaled down character, but I only worried not to exceed 32px in width.
3) Tried playing with background color that is transparent (still need to learn tips on that)