Saving a 256 x 256 pixel icon?

Icons (.ico files) usually contain multiple images. Allowed sizes are from 1x1 to 256x256 pixels. So, yes, you can have icons with 128x128 and 256x256 images. The answer to how to get them may differ. If you are creating icons from images (or 3d), you can add a new format during the conversion operation. If you are drawing the icons manually, you need to add a new format from menu or toolbar and paint the new picture.

I am taking a ready made icon and taking the background out and saving it to a icon sized 256X256, How is this done? John

Are you working with .ico files or with normal pictues like .png, .gif or .jpg?