Try changing the file type and checking the file size. (I believe the limit size for an avie is about 20.7 KiB., someone please correct me if I'm wrong)
I cannot remember how to animate avatars for the life of me, but try reading some of the guides in testing & advertising. (The search function for a page in Internet Explorer & Firefox is Ctrl+f .) If that doesn't say, try searching for it on google.
Awesome Siggy: Spongedude
Fantastic Avie: froggy_00 If I owe/ said I would donate you psybucks, please PM me ASAP (preferably a link to the page that I "bought" the item) and I will try to round them up as quickly as possible (of course, after the cash mod is fully functional). Thanks.