As already noted, graphicsgale is a consideration for pixel art. The free version doesn't allow saving (or opening?) of gif's, but that's not an issue, as you can export it as a spritesheet for C2 to use.
Photoshop is good if you have the money of course, but it's lacking a bit on the animation side.
I hear Gimp has limited animation support now... Haven't tried it.
Also would recommend a tablet for most graphics projects... Wacom is a good brand.