>It may be that the 256 color format isn't available (or shouldn't be used for executables) for the 16x16 format. I can say that, without reservation, that 256 colors in the 32x32 icon isn't an issue.
>
>Maybe Garrett or Mike or someone can shed more light on this.

I'll have to admit to not following the thread, but if the question is whether or not 16x16 icons support 256 colors, I don't think they do. However, I have no supporting documentation for this. The best I could find is here, but it doesn't blatantly say that format won't work. So, IOW, I don't know. :-)