Need help with resizing a frustrating .gif

[Jubel]

I've been trying to transparent this .gif, and resize it down to avatar scale, but every time I do so, it looks a pixelated as stuff, and is bad. I'm not sure if it's the program I'm using, but whatever.

Basicly, I start out with this:

http://e621.net/data/65/a6/65a6acca8f3f929a22c3dcdf10bf2bac.gif?1335679631
Raw link if it's broken, for some reason.

I've attempted to make it transparent in the obvious white spots, but GIMP refuses to save the file with transparency, because of colour reducing issues, and the fact that every frame is visible after the other.

If I transparent it, and resize it, I end up getting something like this:

It looks sharper than a knife, and is bad.
(Obviously it isn't the animation, but it's practicly the same result.)
Either I'm doing something wrong, this is impossible, or GIMP is a bad program.

Can anyone else get rid of the nasty white spots, and resize it down to avatar size without it looking sharp?

[Ad Bot]

[Jerkface]

Where is the original?  I clicked the link, got disturbed by the website with no visible animation, then came back and still can't seem to tell if you've included the original.

[dkamm65]

[Jubel]

Dkamm, would you mind PM'ing me the process on how you did it, because I could use it in the future.
And thanks bro.

[Tammy]

go die in a fire furcigarette