Here's my GoldSrc texture workflow:
I make the texture in GIMP (either photosourcing or by hand), and then I save it as a high-quality BMP or PNG.
Then I open IrfanView and decrease the colour depth to 8 bits, and save the BMP into another folder.
Once I'm done with putting all the 8-bit BMPs into the folder, I open HL Texture Tools and I make a WAD with them.
As for the colours, Wally sometimes really tends to screw up my texture. A single GoldSrc texture can only have up to 256 colours. I use IrfanView now, because it converts it to 8-bit as good as possible. GIMP can sometimes convert RGB 0 0 0 into 27 27 27 (for example), which is laughable, so I don't index the texture in there.
It can be a bit complex at first, but once you get used to it, it's not a big deal at all.
I make my image then drag it over in the wally image editor, then it loads for a bit (idk why), then I try my best not confusing export to save as I need to save as a .wad file, then I have to open up hammer editor and import the .wad into the texture, then who knows if the texture is even right. Once I'm finished with everything, I don't know how to even pack the whole map! I assume you just put the textures in the correct folders and then post it online, but what about people who download it through the game?
First things first, in Wally you should go to File -> New and then pick Half-Life WAD.
It's loading for a while probably because it's converting itself to 8-bit.
As for packing the texture into the map, use -wadinclude [wadname] (no extension). You can even include an entire folder IIRC, and if you want to include more than one, do -wadinclude [wadname1] -wadinclude [wadname2] in HLCSG.
If you don't want to pack it into the map, and have the WAD file in the valve or cstrike folder (for example), create a RES file by dragging and dropping the BSP file into a RES generator. That's all.
One more thing, textures must be powers of 2 if you want to ensure quality and compatibility.
Multiples of 16 are allowed, like 96x96, but that's going to be downscaled to the nearest power-of-two texture (64x64) in OpenGL and Direct3D. Hence 1024x256 looks exactly like 256x256. So yeah, 32² up to 512². This wouldn't happen in Software mode, however.