Natalie;
Anytime you scan an image in or photograph it, use the highest resolution on the camera or scanner. After that, you will need to do some post processing. You don't have to have Photoshop, but you need some post processing software that lets you do at least the bare minimum such as sharpening, color correction, etc. Make sure you save as a new file ("Save As" and not "Save" and never "Save For Web")
When you load to FAA, the site will figure out how large you can sale, but it obviously can't scan for quality.
As for watermarks and copyrights, FAA will not print them if you have them on the image such as this one
See this from the FAQ above --
Should I include a digital signature or copyright notice on my images? Everything that appears in your images will appear in your prints.
Digital signatures are fine as long as they look "stylized". Think of it this way - if you were a buyer, would you want to see that signature on the artwork?
Copyright notices are generally frowned upon. No one wants to see COPYRIGHT 2012 JOHN SMITH printed across a piece of artwork that they want to hang on their wall.
http://fineartamerica.com/contactus.html?tab=faq
