Uh, CapBackfire, Steppin' Out Fozzie's wrists are indeed articulated. Mayhaps you got one whose wrists are stuck? Anyway, I've got So Fozzie's hat pushed down over his left ear. Works well and looks kinda classy. Of course, once I get the Ethel Merman episode on VCD, I'll start a search with help from my friends and customizer for a pair of shoes to turn the hat into Irving Bizarre, Fozzie's agent.
Hope this helps and happy New Year.