Kathy,
Oh, would that we could reduce the application screen!
I use PSP's "sharpen" function after resizing.
My steps, FWIW:
1. Take screen shot, save with thousands of colors.
jpg, pspimage, whatever; just not gif. Yet.
2. Use just a section of the screen at full size, or reduce
the image.
Make sure you use "smart resize" or equivalent, rather than
pixel resize, for example.
3. Sharpen the image. Save it again as the small version,
still full colors.
4. Add whatever embellishments you need. Sometimes I make the
overall shot very small -- barely legible -- and rely on blowups,
popouts, full-size detail insets or popup windows. Separate layers
are especially helpful.
5. Save the final with layers in full color, merge layers and
save again. Convert to gif.
6. Import the gif as is and do not resize in RH.
I know I'm sacrificing some quality. Just capturing the
screen degrades the image some. I'd be glad to hear suggestions for
improvement.
Harvey