About the bulky upper half. If you remember the wolves in underworld mostly ran on all 4's. True they where lankier than what is show here but I like the style. When you think about the balance of the character on all 4's it doesn't seem as top heavy.
I agree with TGZ about the hands, 4 fingers and a thumb/dew claw would be pretty cool. With 3 digits where there should be 4, you have to wonder at what point in the transformation did a digit fall off or meld into another one?
I also agree with Daz about the DOF, it gives the scene the wrong kind of effect, it also takes too long to render sometimes and might not play nice with atmospherics if you decide to use any. Normally you get the DOF effect when the camera has a hard time focusing on the entire scene such as with tiny objects. So people are used to seeing this type of camera distortion on shots of tiny things.
There are other effects that can be used that won't make it look like the camera is having a hard time focusing on the whole scene and give you the separation of character and scene you want. You might want to do two sets of renders, one of the background slightly blurred using normal blur features in max or use something like DeFocus
and then composite the character into the shot.
Also play around with some advanced lighting set ups like Radiosity to help the lighting along.
One last thing don't forget about water ripples around his feet =)