For your designing, you definitely have to use a paint program such as: Paintshop Pro & Photoshop. Only the paint program from windows won't work. You only have to remember that if you save a picture, it has to be saved as a .bmp file.
For designing logos, its best to use Photoshop.
Sizing of images
The dimensions of the picture are very important. If you do not follow these instructions your colorspray will NOT work. Here are the dimensions which work (number on left is first dimension, numbers on right are all that will work with first dimension):
16 * 16, 32, 64, 128, 256
32 * 16, 32, 64, 128, 256
64 * 16, 32, 64, 128
128 * 16, 32, 64
256 * 16, 32
There are other dimensions which will work but you won't really need them. The ones given above will be quite enough.
If you already have an existing picture & you wanted to use that as a colorspray, resize the image to 128 width and 64 height or 64*128 (That's my favorite size). In Photoshop, click: Image and then Image size.
You might want to design a new picture. Click File and then New. Use 128 for width and 64 for height or 64*128.
When this is done, you have to save the logo. Click for File and then choose Save a Copy
Choose BMP (*.BMP,*.RLE).
Now you just have to make it run in the game...
With the new Wally 1.53 beta, converting images to WAD can never be easier.
Download Wally 1.53 beta.
After you've got the program, start up the program and click Wizard on the menu bar and then select HL Color Decal.
This will open the Half-Life Color Decal Wizard
Now press the File on hard drive to select the BMP file or JPG file which you wanna make into spray.
Click OK and the conversion will take place. The last color palette will automatically be edited to blue.
Now click menubar File and choose Save As...
Save the pldecal.WAD into the folder of your HL mod.
CounterStrike MOD - save it to \halflife\cstrike
CounterStrike Retail - save it to \sierra\counter-strike\cstrike
Team Fortress - save it to \halflife\TFC
Front Life Force - save it to \halflife\frontline
Half Life - save it to \halflife\valve
Overwrite the existing pldecal.WAD and click OK
Load up CounterStrike, but DO NOT go into the player customization screen to see if it worked. If you go to the player customization screen, your pldecal.WAD will be overwritten and you will have to start over this thing again. Also it might take a couple sprays to get it working at first. so spray 3 or 4 times in advance just to make sure. Happy Spraying.