If you search 'splashbar' on this bb and its archives you will find a lot of history.
This thread will help you a little:
http://www.thechipboard.com/index.cgi/md/read/id/1161432/sbj/rofl-rofl-splashbar-rofl-rofl/

There are no minimum requirements regarding size and dpi but obviously the better the image is the better the result will be.
If the image provided is smaller than real size then dont expect too much. 300x300 at 150dpi is realistically the minimum. Anything will be automatically resized anyway.
The camera ready comment was meant to indicate not requiring editing of or creation of a design (other than for example, cropping out from a full size photo, which is fine).

Hopefully, others can post some examples of previous chips in this thread.