Adding anti-aliasing to pixel art is like giving the budding young papercraft artist an X-acto knife to replace his crayola scissors. In the hands of a thoughtful, motivated artist, this technique will immeasurably amplify what you can accomplish with pixels. In sloppy and rushed hands, you’re going to wind up with a pillow-shaded and possibly blood-stained mess.
But then, if you were sloppy and constantly rushed, you wouldn’t be very interested in pixel art to start with, would you?
For the newcomers: AA is simply how regular digital images like photos and illustrations slightly blur or smear their pixels to make them blend smoothly into each other so fine details can show up better. AAing for pixel artists is the art of using that idea to the barest minimum, so you get the most blur using the fewest pixels. Remember, pixel art should be both crisp and, ideally, easy to animate.
When working with pixels, you’re trying to build smooth art with sharp blocks. So how do you smooth out square pixels? By smoothing their colors and shades as they blend into each other. Alright, but when and where do you actually use this trick?
In short, the answer depends on the art style you’re going for. If it looks jarring, try to smooth it out with as few pixels as possible. Keep in mind though that you should only take this so far — at some point, (when rendering a 1-pixel wide zipper, a crease on pant legs, shoelaces, etc), you should let pixels be pixels. That’ll keep some of the natural charm of pixel art and add some real depth and variety to your work.