First, just keep them as TGA. TGAs work just fine in-game and it makes editing easier.
But there are a few points to making TGAs. The first common mistake is that the size must be a square of 2: 2*2, 16*16, 24*32, 256*512, etc, up to a max of 512*512. Second, make sure you close the game before attempting to view them. The game only recognizes images that were created BEFORE it started (though you're free to modify once it's created with a simple reload).