you should resize the picture by 80%, or to whatever 640x480 is in a external picture editor.
something like photoshop would come out smoothest, but something like microsoft office picture manager will come out just as good.
the reason is becuase RMXP's zoom out on a high quality picture will make everything seem jagged and pixelated, like in the screenshot above.
just a tip, lol.
good luck with getting it out though, will look forward to playing XD