Hitting the "print screen" button on your keyboard will take a picture of your entire desktop. Just open an image editing program (irfanview highly reccomended) and paste it. Then crop away. Now, if you wan to take a picture of a specific window, make the window active then hit Alt+PrintScreen and it will only capture a shot of the active window. Then paste it.
I do exactly the same Kyle does, i.e. pasting it into IrfanView. Then save as PNG, which means small files with no artefacts. JPGs are just not suitable for screenshots.
Depends on the application. If using it to display on the internet for help purposes JPG is probably the best. For importing backgrounds into Flash where image quality is very important I also use PNG.
Another option is Print Key, which I've used for years and it works quite well. Great little tool for software projects and home use. Print Key has various formats to save a file and also you can predefine the area you want to save.
Print Key, freeware does not save to the PNG format, but does a marvelous job for most people.
Also, there is a version of Print Key you can purchase ($19.99) that saves PNG and also has adds a few twists to the program, but freeware is, free.
Then there is another tool I am aware of named Screen Print and Capture which does PNG extensions. I'll include that link too.
I prefer Print Key, but hey, always nice to have choices.