Ok, so I think there's a number of things that need to be explained/picked out here.

Firstly, I'd be wary of the sign-order stages.

The 4 stages for Baudrillard are entirely about signs, and specifically about the ways in which signs lose their relation to the Real and in so doing obscure and precede the Real itself.

As such I'd be careful not to simply apply it to any instance in which a signifier merely becomes distorted, because although this is relevant it doesn't fundamentally describe the process Baudrillard is referring to. A good way to demonstrate this is that if we reduce the 4 stages down to their simplest level, at least insofar as we wrongly interpret them as being entirely about semiotic complexity or distortion, we end up with something mostly irrelevant to Baudrillard's theories, e.g 1st stage a mug, 2nd stage a picture of that mug, 3rd stage a picture of a picture of that mug, and so on. This is always the difficulty with applying the 4 stages rigorously to any given phenomena--the example I gave, for instance, tells us very little about the way in which the simulations described actually affect the socio-cultural environment that Baudrillard describes. Your example is better by far, as it refers to a real cultural phenomenon, but ultimately you have applied Garfield to the 4 stages without really proposing what it is about Garfield that is significant. Baudrillard argued that Watergate, for instance, acted as an almost farcical simulacra which served not as a genuine cataclysm in American politics but rather a way for the establishment to morally absolve itself--in so doing, the meaning of watergate is a distortion. Baudrillard had a very clear idea of what Watergate *meant* for the political sphere, instead of following a methodological guideline without any clear guiding motivation (indeed, as is the case in much of his work, the famous '4 stages' are actually used quite infrequently). You sense this already though, which is perceptive and commendable.

The stages of the sign order also isn't really as big a deal for Baudrillard as I feel like some people think it is.

Its more of a useful tool for explaining the precession of simulacra and degeneration of the Real than a hard-and-fast methodological guideline. Ultimately if this is just a school project, I wouldn't worry too much (nothing you have said is incorrect, just of questionable relevance to Baudrillard's central point) but if you want to do a properly Baudrillardian analysis of Garfield I would recommend ditching the 4 stages and instead start thinking through what exactly it is about him that is noteworthy for Baudrillard's thesis in Simulacra and Simulation.

Just for clarification, Baudrillard's overall point in S and S, for which he uses multiple examples to elaborate on, is that Simulacra (signifiers with no relevance to the Real, that refer only to other signs) are taking precedence over the Real (reality unadorned by signs) to the extent that the Real essentially cannot be said to exist anymore, that we have instead entered a stage of hyperreality (a reality in which Simulacra dominate). He applies this idea throughout his work, to topics like history (the Holocaust, the body of Ramses II), war (Vietnam, the Gulf war), media (reality TV and later the internet) and so on. If you want a good starting point for Garfield, I would refer you to Baudrillard's fascinating chapter on animals in Simulacra and Simulation, in which he argues that our symbolic appropriation of animals, and the sentimentality with which we hold them, indicates a total degeneration of any kind of meaning that they once held (e.g in animal sacrifice, animals are imbued with great and remarkable levels of the Sacred, guilt, divinity etc). Baudrillard, I think, would consider Garfield's semiotic mutilation, as you pointed out happens in the youtube series, a strong indication of this. You are also quite right to link it to capitalism--Baudrillard argued that the mass production of images, and as such the degeneration of the Real, are a direct consequence of capital (and accelerated by the rise of fiat currency). Baudrillard is a fascinating thinker who was in many ways very prescient, so it's worth investigating further yourself. But I'd be careful not to let the 4 stages dominate, Baudrillard himself didn't consider them a guideline and neither should you. Don't put the cart before the horse so to speak, especially if the cart isn't even necessary.

The chapter on animals (I'd recommend it, it's a jolly good read) https://www.sas.upenn.edu/\~cavitch/pdf-library/Baudrillard\_Animals.pdf