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ToYcon (free) works a little differently from the ways other icon apps do. When you launch ToYcon, your screen suddenly gains an icon of a cardboard box with a green arrow going into it. This is a drag and drop box, which converts images in many selectable file formats into the Windows .ICO icon format.
You can set ToYcon up to convert to Vista high-res 256 x 256 pixel icons, or lower-resolution icons that work with XP, by right clicking on the cardboard box and changing the options in the dropdown menu. You can also choose where to save the file, and even convert a dragged and dropped icon into a .PNG image file. (.PNG is like .JPG with built-in transparencies.) Of course, to extract this .ICO icon from your favorite program, you'll have to use another app, such as the recently reviewed Sib Icon Editor--or the best free icon editor I've reviewed, Greenfish Icon Editor Pro.