I could be wrong, but it looks like you're trying for the dwarf-ish proportions just by scaling the body parts, right? If that's the case, it's probably because of disproportionate scaling... ie, if you scale the chest by x amount, but you don't scale the collar by the same amount, it can make the mesh whack out... you may want to try applying magnets to the parts that are sticking out and pull them back into the place where they should be. You may end up having to do that to a few body parts... once you've got them all morphed back though you can create a full body morph so that you can apply them all at once... I think you can even create a pose file that'll save the scaling so that you could recreate the dwarflike proportions on any Michael character just by applying the pose... but I'm not exactly sure how you'd do that... I'm sure there's a tutorial out there somewhere...