There are a few of these around, but this one seems really cool.
You have the ability to import an image, tweak it, or even create from one from scratch.
The best thing though: real-time preview of the final 1:1 results, while you work on a larger version above. Truly wysiwyg.
Who can use this utility? Webmasters.
Favicons are more than a novelty. In my Firefox UI, I have a row of them on my menu bar for one-click access to my favorite sites. Chances are that you also have 10 or so sites that you visit regularly.