Which icon sizes should I include?
16, 32, 48, and 256 covers essentially everything on Windows: 16 for the browser tab and address bar, 32 for the taskbar and desktop, 48 for large icons in Explorer, and 256 for the extra-large view and modern high-DPI displays. Those four are selected by default.
Why does an ICO hold multiple images at once?
So the operating system can pick the right one instead of resampling. A 256px icon scaled down to 16px by the OS looks blurry and loses whatever detail made the logo readable. Embedding a purpose-scaled 16px entry means the small size is at least the best a 16px version of your artwork can be.
My logo is unreadable at 16 x 16. What can I do?
Nothing at conversion time. Sixteen by sixteen is 256 pixels total, which cannot hold lettering or thin strokes. The fix is design, not tooling: use a single bold glyph or mark, drop the wordmark, and increase the stroke weight. Every recognisable favicon on the web is a simplification of the full logo.
Does my JPG need to be square?
It should be. Icons are square, so a wide or tall JPG is squashed to fit each square slot. Crop to a square first, ideally at 256 x 256 or larger so the biggest entry is not upscaled.
Is an .ico still needed for a website favicon?
For maximum compatibility, yes: favicon.ico at the site root is still what older browsers and Windows shortcuts look for. But modern browsers prefer a <link rel="icon"> pointing to a 32px PNG and, better still, an SVG that scales. Ship the ICO as the fallback, not as the only file.
Is my image uploaded to build the ICO?
No. Each size is rendered on a canvas in the page, PNG-encoded, and packed into an ICO byte structure whose header is verified before the download is offered. Nothing leaves your device.