Is it worth another re-knit?

So I finished Jack's orange sweater - for a SECOND time:

I completed unwound the sweater I knit this fall and re-used the yarn on the same pattern with minor alterations.  It fits MUCH better.  I re-knit it over a few days time.  Now it's something I'll actually dress him in.

So the question in this post title refers to this other sweater I finished:

It looks better in action, as in the shot on the right where Jack is sitting in a cart seat for the first time (that was about a month ago).  I've worn and washed the sweater several times. 

On the one hand - yay!  I knit a whole sweater!  Yippee me!  I like the color and the yarn from knitpicks is really nice. 

On the other hand - not a flattering top at all.  It was supposed to look like this:

Short puffy sleeves, waist flattering, with a high neckline!  What happened on my pattern?  I knit it a size too small according to my gauge, and it's still boxy and over-sized.  No matter how I style it, I feel frumpy.  Ben consoles me, saying it looks home-made, but in a good way!  Hmmm.

I feel as though I could make some major improvements.  Make the smallest size, add the collar last to pull it in, shorten the sleeves and take out the puffs, and add more waist shaping and length.  But that would mean tearing it to pieces and starting over from scratch.  While making this sweater, I already restarted 3 times after knitting about 8 inches of length.  So it's not inconceivable to tear it out again.  But . . . so disheartening.