you can use this: http://www.mapzoneeditor.com/index.php?PAGE=HOME to create seamless textures, i havent used it before but i believe a few other users tihnk its pretty good.
to use an imae as a texture, all you have to do is click file->import->select the 'use image as texture option->'select the image you want to use for your texture' SU willthen give oyu a coiple of handls to stretch the image over the face you want to texture, when youve placed it, it will then tile across the entire face. to paint it onto other faces, ismply go to the paint bucket, and select 'in model' textures.