I think the video is pretty good, especially for a first time!
The technical problems you're having with picture quality are not because of your camera, it's because you're not using the camera's settings and exposure controls properly.
My suggestions:
- Ditch the blue/green screen for now. As you've discovered, keying fur is really annoying and since you're working with a plain backdrop it's unnecessary. You can buy a roll of photo backdrop paper for around $30 and it will work great.
- Use fewer lights. You seem to be having trouble with overexposure and you don't need six lights to light a simple two puppet set-up. A key light, a fill light and a light for the background should be plenty for something this simple.
- If you still think your lights are too bright you can try bouncing light from them on to your subjects using sheets of white foamcore. You can also try using diffusion paper in front of the light, or a neutral density filter on the camera to reduce the amount of light reaching the camera's sensor (honestly, I don't think I've ever seen a situation where it was necessary to diffuse soft boxes if the camera's exposure was set correctly).
- Watch Tom Antos' YouTube tutorials. They will teach you everything you need to know to get started with DSLR filmmaking, including how to best set-up lights and use exposure controls.
Both of the cameras you have can produce great video if used correctly. Generally, you should shoot using a flat picture style, then grade your footage in post production. That creates more work, but it also gives you more control.
I suspect shooting RAW on the T3i with $2,800 worth of incredible lenses you will produce better images that what you'll get with the $2,800 XF100. Also, when the XF100 is obsolete in a year or two you can still use your awesome lenses on the next camera you buy.
Also, just FYI, one disadvantage of the T3i is that it records in .mov format, which is a bit lossy and not ideal for shooting green screen or blue screen elements. The XF100 is probably a much better camera if you keep using green/blue screen.