For the avatar dude, I will add a button to change it. You'll be able to toggle between the current version, one where only the genitals are showing, and one where he completely disappears.
I'll do a little research on the "bouncing" issue. I was able to make it less noticeable by cleaning the four cameras on my headset. I think a lot of the problems with that are due to the Quest 2 not being designed for AR. The main reason I'm developing for passthrough, is to figure things out for when the new headset comes out (hopefully this year sometime).
The little versions of the characters are mostly meant for the character selection. I'm not intending to have them grow to full sized. Maybe I should reconsider that.
I'm currently working on an HD character that may be ready in the next couple days. She's looking really good.