If you are working with paint I recommend saving to BMP format and converting this file to jpg with a different application (like MS photo editor) the to be able to see and use it in LFS. The JPG compression from paint is rather ugly. Especially if you modify-save-look-modify-save-look multiple times. Your artwork will turn in to mess otherwise.
(maybe this thread should be moved to the skin-section)
Without the VWS it's still the best sim/game 24 pounds can buy and I am confident it will be a gem when it's released. The announcement of limited setup parameters for a roadgoing car made my day!
Some people should remember what they agreed to when financially contributing to the development of this game.