TGA (textures) shoud be sized to be a power of 2.. 2,4,8,16,32,64,128,256
examples:
2x32, 32x64, 64x64, 128x64, 256x32 should all be valid..
Note: I wouldn't go over 256x256... Some (old) video cards (like voodoo3) don't support textures over 256x256
Resolution I believe is 72 pixels per inch
Hope that helps
Edit: I'm not sure if resolution really matters..
And: Check out this thread from the info.vault
http://www.eqgui.com/showthread.php?s=&threadid=458