Natural light is all well and good but direct sunlight will be difficult to work with and any natural light will have color temp shift that the auto WB may or maynot handle correctly and may require manual adjustments in the camera. Whenever possible it is preferred to use a window facing North. One has to be careful also of light that comes thru the window that may have bounced from another building and depending upon the color of that building may affect the color balance of the image.
When I look at Kens box camera angle seems like it might be a problem and also the diffusion material has wrinkles in it and that will affect the highlight/shadows falling on the subject. It is imperative that the material be absolutely flat for the best and most reliable results.
When I see setups like this and I know Coop that this thread is the $75 setup, what with products available on the market and quite inexpensive prices without the inherent problems attached, it concerns me that folks don't just buy a good product instead of spending time & $ in this way.
I also see that the distance from the light to the subject is not very much and this does not allow the light to diffuse enough before striking the subject. Move the lights farther from the diffusion material so as to allow the light to spread and then be diffused before it strikes the subject. If you are unable to do that, then add a layer of diffusion material to the outside of the lamp holder which will add to diffusion.
During the daytime, if direct sunlight is coming thru any of those windows, Ken, try to cover the windows as extraneous, uncontrolled light can also affect the results.
Just a few thoughts on things that may help with knife image making.