I have mentioned that I looked into creating a custom template for Blogger. It was not as easy as I first thought and I did not have the time to better figure it out. But I thought I would share with you what I learned.
First, create a test blog. You need this for two reasons. A: You cannot upload a new template and view it without it being published to your blog. B: If you do have an issue, you won't mess up your actual blog.
Here are some tutorials and sites that I found helpful:
The Web Designers Guide to Blogger Templates
Template of Doom
Tutorials on Blogger Template Design
Cheats Guide to Customising Blogger
How to Host your Template Images
I also used Gimp extensively.
My biggest suggestion would be to design your blog layout, where you want things to be and what images you want, first. Then after the design is done start building the template.
There are also some good resources for free blogger templates. Make sure you check them out as well. At the very least they may be inspiring. You can also download them and peak under the hood to see how something works.
Ultimately I decided to go with a customization of built in blogger template. But it was fun to play around with making custom templates.