Hey gamersplace.

We actually had a thread on this exact topic not too long ago!

Here it is: http://www.webforumz.com/topic.asp?TOPIC_ID=569

That deals with cutting up layouts from photoshop.

In terms of the size you should use... Well there's no right size. Statistics show that the most common resolutions are 800x600 and 1024x768. So it makes sense to stick to 800x600 as most 800x600 sites look fine in 1024x768.

If you make your site fit 800x600 exactly (and not expand for larger resolutions) then it could look a little bad in, say, 1600x1280. However you can design so that your layout expands to the width of the screen, etc and looks good at pretty much any resolution.

If you also use percentage font sizes then the user can change the size of the font and your text should look good on pretty much any screen.

I'll also mention something that some starting designers don't realise: You want to make your layout slightly smaller than your intended resolution. Remember it's got to fit INSIDE the browser window, so you're going to lose a few pixels from either side (horizontally) and many pixels vertically. A good design for 800x600 should be about 780x400. You get the idea!