loss of clarity when importing into the xxxxxx.fsh

is it me? are my photoshop settings off? if I import a bmp into a stand alone fsh file, its fine. when I try to import a fsh, bmp or whatever into my render/xteam folder/xxxxxx.fsh, the fine detail get screwed up. I have to use letters and lines of 4 pixels or wider to make the jerseys look half decent.
help me.

Try importing .dds file using the photoshop plugin that can be downloaded here at NLSC

thanks, bro. I'm checking it out.