^Those are some big words for someone in your league, eh Wof?
And I think the "Don't use jpg" rule only applies when you're using two-toned backgrounds. The comics at
Captain N.net are jpgs and they don't really look too blurred.
Also, you don't have to keep the bittage at just 16 or 32. Some 32-bit sprites look alright if mixed in with 16-bit backgrounds. 8-bit sprites in 16-bit backgrounds is bending it a bit, and 8 bit sprites in 32-bit backgrounds or 32-bit sprites in 8-bit backgrounds is NO. Plus, some 32-bit sprites (Namely GBA sprites) look like 16-bit sprites and look alright with some 16-bit backgrounds. Why? Well, because the GBA has so many damn remakes of 8 or 16-bit games!