Yes, your eyes are not fooling you, that's what the characters from TaleSpin looked like in their first version...Scary, isn't it?

During my searches, I have collected a few of the artworks from the characters with this old design. Let's examin the characters one by one...

Baloo

He's probably the one that look the most similar, which is obviously because he already existed in The Jungle Book and they had to respect it. He still has his yellow shirt and a hat, although he went through many changes :

- He has claws!!! Well, he also had claws in The Jungle Book, so it shouldn't be so surprising : we can safely assume that they changed them to actual hands when they wondered how a bear could pilot a plane and handle a steering wheel with claws...

- The hat is yellow and is a bit different (it has a falcon-looking logo, which they may have replace with a circle to make animation easier)

- He has whiskers like in the Jungle Book (or whatever this is for a bear), although he lost them in the final design. We don't see it, but I wouldn't be surprised if he still had a tail too (although his tail does appear in some Talespin episodes, like in "The Balooest of the Blue Bloods", but they were mistakes from the animation production)

- His eyes seem a little smaller, and his belly...too.

Kit

When Kit only has a sweater and no pants in the final design, here he has pants and is shirtless! His fur is lighter, and he exchanged his blue cap to a red one. (and his hair goes through it) He also wears a bandana like in "Plunder & Lightning", although this one is blue instead of red. Finally, his nose is red like Baloo's, and his eyes are much bigger. 

Molly

Wow...where to start? Her fur is orange instead of "yellowish", she has blue eyes, a pink nose. She didn't have that cute hair, and her only ribbon is pink and much more larger. She's almost as big as Kit (at least on that artwork), maybe they intended them to have a similar age? Finally, she has a pink dress...

EDIT : After second thought, I'm rewriting this part of the article : the character appearing above may not be Molly, after all! (maybe Kit's girlfriend?) Because Molly looks different on other artworks :

Here, she has yellow ribbons in her hair and a blue petticoat, which makes her look more like a baby.

Rebecca

She underwent major changes too : her hair brush is totally different, she has makeup and red lipstick. She didn't have these spots (or whatever the right word is...) around her eyes, she had a red nose too and very scary eyes and smile...Her clothes seem also more detailed. Her pants don't go to the bottom, and she had heel shoes.

All in all, she looked less "nicer", and who knows, maybe this design sticked closer to her business woman personality? 

Wildcat

This is the only picture I have found with his old design.

He's still a mechanic of course, but a different model. He has orange overalls instead of white/blue, and has yellow gloves. He has orange hair with a different style, and apparently didn't have a cap.

Louie

I haven't been able to find a better artwork than the one at the top of this page, but he looked very similar to his final design, logical considering he originated from the Jungle Book too. His hat looks a bit different though?

Also, the characters are not the only thing that has changed, Higher for Hire and the Sea Duck too! Take a look at this (awesome) painting below :

Higher for Hire (old design) : click on the picture for a much bigger resolution one!

We can see the main crew of Talespin, with a more futuristic version of the Sea Duck (but still yellow and red!)

To conclude : Considering the amount of *colored* artworks we can find from that previous design, we can seriously believe that this is how the Talespin characters *should* have looked! Yet, the reason for the whole redesign is still a mystery.

Sources :

- Socalspinner.com

-

- My personal Disney Club Vacances magazine