MC Ren says “When I told Eazy I wasn’t gonna do the NWA album, me and him didn’t talk for like a year or two. Probably longer then that. When Dre was doing the first Chronic album, I was still talking to Dre. I would go to his house and be kicking it. That’s why Snoop says in the Intro of the Chronic, “What up Ren.” Cause I used to be there kicking it with niggaz.” https://escobar300.wordpress.com/2012/12/15/mc-ren-speaks-about-ruthless-records-how-the-rap-game-went-soft-and-tupac-clones/

So this is a shoutout to MC Ren, not a diss as some might think. MC Ren continued working for Ruthless Records after the N.W.A. breakup, but remained neutral in the argument between Dr. Dre & Eazy E. So basically the sentiment is “Fuck the rest of y'all, but we’re good with Ren”.

Theory 1: A penguin is black and white, which may hint at dissing Eazy and Jerry. Dre makes similar direct at them in Bitches Ain’t Shit

Theory 2: It could be as simple as Eazy was short, fat, and black. On top of that, he wore some big ass shirts, which made his legs look tiny.

Theory 3: Penguins look like they’re wearing tuxedos.

Theory 4: It came from a PSA shown in the late 80s-early 90s about staying in school. At the end, a cartoon penguin wearing Locs (Eazy’s trademark shade) and jeans runs up and says, “If you wanna be cool, stay in school!”
https://www.youtube.com/watch?v=WkayCY5paMM

Not a reference to Jay’s supposed Illuminati ties (those conspiracy theories are of more recent vintage), but rather to his pursuit of mass-market fame via corny pop singles. Nas has had his low moments, but he never attempted to cross over as blatantly (or at least, as successfully) as Jay on songs like Sunshine and Hard-Knock Life. Jay himself admitted that he made In My Lifetime, Vol. 1 for the radio {citation needed}.