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It wouldn't change the number of frames but something that would be nice in regards to the animation is if the avatar could be set to only animate when it moved. Basically, having it switch between frame 1 and 2 each time it is moved into a new square on the grid. This would make it possible to add walking animations without the avatar constantly walking on the spot whenever the player stops.

Both ways of animating have different advantages of course, so having a selection box (say "looping", and "walking") on the avatar tool so users can select which type of animation they want to use would be neat.

(+1)

yes, I'd like to do something like that. another related though I had would be to have the option for the avatar "sliding" between grid spots instead of "hopping" instantaneously like it does now - it could animate during that transition potentially.