Okay so! I recently discovered that the channel mixing thing in Photoshop is about the only thing that can rescue some of DDS's screenshots. This will probably only be helpful if you're dealing with screenshots that are way too dark and have creative lighting. Here's a quick guide to how to use it to make your screenshots more iconable.
First take a screenshot! I'll take one that isn't the worst screenshot in the game to try to fix, but is definitely up there:
...Yeah. Way too dark, and way too red. First step, for me at least, is auto-level! (Image -> Adjustments -> Auto-level) It works well enough to at least give me a start and it makes it nice and bright. Some screenshots you'd probably have to play with the levels manually, or you might find it doesn't make any difference at all. As you can see, though, it's clearly not enough on its own:
Yeah, nice green turtleneck there, Cielo. Okay! Clearly this is not suitable for iconning! Though the face isn't terrible. Therefore, let us go to channel mixer (Image -> Adjustments -> Channel Mixer) It will give you this:
(Well actually it will give you the red channel, but the green channel is the one I want to play with first on this one because clearly that needs the most work.) You'll notice that green is at 100, and red and blue are at 0. So then I play around with it! It previews what you're doing, and so just keep playing with it until you think it looks about as good as it's going to get, just by using that channel. In this case, I ended up with this:
A lot better! But still not quite right. So I go to the red channel. In this case, red starts off at 100 and the others at zero. After playing around again, this is what I end up with:
Better! In some ways I like the previous one more, and if I were actually iconning this I'd probably spend another 20 minutes playing around with this and the blue channel, but whatever. After this, I'd crop, resize, and unsharp mask like any other icon. (I like the way unsharp mask looks better than sharpen, at least at low levels of unsharpening.) And then I have a new icon yay~
I'm working on a new iconset for Cielo using this, but expect it to take forever because I'm lazy.