OK...not too difficult to do.
1. You don't always need to 'cut' out the image you want to paste. I usually select a hot pink color (or any color NOT in the current image, bright obnoxious ones work best) from the palette then 'paint' the parts of the image that I DO NOT want with that color. When selecting this pink color, I ALWAYS select it with the RIGHT mouse button, making it my secondary color. If you're using the eyedropper to pick colors, the left mouse button click in the palette makes that color the top/primary color and the right button makes the palette click color the bottom/secondary. Follow?
2. After filling/painting the areas you don't want, simply copy the ENTIRE image.
3. Next, select/activate the image to paste INTO...
4. Simply use the 'paste as transparent image' command or SHIFT+CONTROL+E. This will paste your image WITHOUT the pink background into the other image.
5. BEFORE you click anything you will have your pasted image with little dashed lines running around it. You can resize just THIS image and not the whole thing if you want or need to fit it better. Be careful with the resizing tool. If you get too many jaggies you can use the blur/soften tools under 'image'. This can improve your image alot, especially after resizing.
Hope this helps. I've done thousands of images using this method for everything from Nascar Racing to Thief to MOHAA. Always works, justs takes practice and time to learn all the tools. IMO, PSP is the best and easiest program for light to moderately heavy editing. PhotoShop is amazing, but generally too expensive and with a TON of stuff most game modders don't/won't need for basic skinning.
Any questions, email me here:
ditt44@paonline.com