Assuming your final template will fit on any page of your browser to a resolution of 1024 * 768 pixels, an image minuature 25% of this size is generally acceptable, a dimension of 256 * 192 pixels for your template_thumbnail.png. Take, for example, a dimension of 250 * 200 pixels.

You can create this file with a miniature drawing tool of your choice, once the design of your template completed. A screenshot and a reduction of the image by specifying the dimensions in your drawing tool is easy and fast.