It looks fairly straight forward, but I've never tried it myself.
This tutorial seems to be out of date. I was following it, but the options stated have changed in the latest release of SimPE.
I really hate the single color frames (I wanted to use the "That Place Over There" template to work from), and was hoping to update the template with a different frame (silver/gray) to create recolored objects.
New Template! Glamour Life Stuff "The Muse" by Stella Livorno
Apologies for the necropost, but maybe someone will find this useful.
Template for the Glamour Life Stuff painting "The Muse" by Stella Livorno
Template goes into your SimPe/Data folder.
Your image does not need to be flipped in Photo Studio, however you will need to rotate it 90 degrees clockwise, due to the orientation of the frame (see attached preview).
I found I could get a better quality using RAW24 option, rather that DDS Utilities. The file size increases but the blurriness is minimised when viewing the painting up close in-game. The difference, however, is negligible when the painting is viewed from a distance.
Preview includes the canvas co-ordinates, in case you need to fiddle with the proportions of your image before creating.