You aren't a moron. You just have to learn.
I'm just surprised
you have never heard about SC. The first version has been released in May 2007.
To create 32 bit bitmaps you can use Gimp, Blender, Adobe Photoshop or 3ds Max. To reduce the number of colors, you can use RAD Video Tools, read the courses from my website.
Each image collection has its four color palettes for its four layers. Take a look at weapon sprites. "Guibig" refers to different image collection than "Guismall", this is a way to increase amount of different colors.
If you try to add a new image to an existing collection, note that this collection has already certain number of colors, mostly 256, so you can't add new different colors, you can add only identical colors.
Don't try to match up your images to existing color palette. It's a bad way. Create a new image collection or delete all images from collection's layer. Sprite Creator preserves layer's color palette until last image from this layer will be deleted.
For example: If an image has a lot of red tints and you will import it to a collection, next, if you will create a second image which has a lot of green tints and you will try to match up this second image to the exported color palette which was created from the first image you will get bad results. There is no color palette optimisation.
Single sequence can use only one image collection, so guibig and guismall are two sequences so you can use two image collections.
If you import two images into one image collection every new color is added to color palette. SC accepts exactly 256 different colors (not less than 256) for a collection's layer. For example: image1 has two colors AA and BB, image2 has also two colors AA and CC, their sum of different colors is equal to 3. Image size is unimportant.
If you would like to create an animated sequence, you have to have one color palette for a layer. This one palette must contain all different colors that can be found in all images that have to form an animation. You don't have to merge images into one big image. There is very easy way and gives great results, use RAD Video Tools and
read here how to use this tool.