I ran the textures through j peg optimiser (photoshop plugin) so I could compare the two versions as I worked. I think I reduced them to about half the size (in megabites not in scale) and they didn't look much different really. I renderd the dragon with just the head texture (full size) and then with the reduced version to compare and (to me at any rate) there didn't seem to be much difference. another option that as worked for me is to take the dragon into bryce and render it there (if you've got bryce of course) though this is a longwinded way to do it.