
So for Malone, the first thing to note is that he needs to get to 2,001 XP to hit 2nd level (yep, the actual charts in the PHB make you get one XP over the mark, believe it or not).
Going from 1st to 2nd level, the main benefit for Malone is going to be hit points gained. Secondary benefit will be when fighting known creatures of less than one hit die (essentially, any fight against a creature previously encountered where the creature has less than 8 HP will grant Malone an extra attack per round at 2nd level, 2 extra attacks at 3rd, and so on). No change to THAC0 or saves.
Onlyme, I assume that you're contemplating whether or not to take a rest in order to gain the level sooner than later, but it looks like you're still a few XP shy even after the battle with Krell...?