The red pins on my Gresh have the "cuts" and they work ok.
The articulation is pretty good as well.
Sorry for double post, but i gotta post this right away.
Seems like our Chinese friends are a bit ahead of Lego:
If the original Lego figures that will be released this summer that are 25-30$ are a bit too expensive for you, then you can get one of these XSZ Star Wars figs for just 6$!!!!
Edited for Double Post - By Scarilian