The quality is only affected when you enlarge a picture. In fact it usually sharpens when you make it smaller. He means it looks like a banner because it's too cluttered to be an avatar. An avatar is supposed to be something simple. You should limit it to one pic and 5-7 words at the most depending on the size of the text.
The quality of the avatar is not very good, and it doesn't look that good either.
For an avatar it's best to keep it simple as there's not much room there, your's is cluttered. I'd have one cena pic and have it take up most of the banner with some sharp simple text on the left handside or at the bottom i I were you.
Well, maybe a bit but if you look at a lot of avatrs (mine, ndf's, fmir's for example) then you'll see a lot of them keep the focus on one main feature, im my case a face, add a bg and a small ammount of simple text.
The rock bit is too small and the bg is a bit boring and the text sucks. Also, the pic of the belt is un-needed.
If you try screwing around with some filters you could probably come up with a decent bg for it. Also you should probably find a better eddie pic and have it fill most of the avatar. And get some fucking fonts, would ya?