Wooh! Really deep into the uncanny territory! Actually, that's not very good... here's what I'm talking about if you don't know already:
http://en.wikipedia.org/wiki/Uncanny_valleyNow I only have the paws left (which will be hard), and then lots of optimization and tweaking. Optimization isn't a big deal, as I tend to optimize as I go, but I will have to do a lot to get it to look natural and as one body, and not many body parts. Just look at where the neck and body join. I will also need to twist the tail to make it more like a... tail. Not a bent piece of steel.
Then comes texturing... Should be easier, though. Only a handful of base colors, and a few unique shapes. Other than that, it's free sailing from here! And I want to finish by Friday, because I will be forced away from my computer for a week afterwards... Me no want that, but I can't stop it.
And Thegani99, you effectively guessed correctly: I use clip-art and screen-shots as base references on how the figure should look like. But it really comes down to my imagination and "what looks and feels right". And the program is simply called Blender.