Image handling in AutoCAD needs more work to be done as well as documentation. If you want to do customization you will find that there is a lot of trial and error. Unfortunately with the new Ribbon there are a lot of problems.
In CUI there are three sizes available, Standard, Medium and Large. It is not obvious what the difference is.
If Standard is used and no label is showed there is a frame around the icon as seen below on the one without a label. If Medium or Large is used and there is a Large image specified it will be used.
Another thing is that the image size is not respected. Notice that the images above are larger than the correct 32x32 size below.
What if you want to use other image formats than BMP. The "select image file dialog box" is limited to BMP file formats but if you enter * as file name and press enter or *.png you will find that you actually can select and use PNG, GIF, JPG if you want. One good thing with and reason to use PNG is the support for transparency.
Share your tips in the comments.