Hi Andy!
First off, welcome to the digital download world! :D I think you'll find it's a bit different than selling jewelry or other items on Etsy. I've also done quite a bit of selling jewelry here on Etsy, so I hope I can give you some insight into digital downloads vs. physical sales, as well as some tips.
If the 20 cent fees are adding up too quickly to you, I would recommend uploading your items very slowly so you have time to make sales and earn back some of your money. Starting out, it will seem like so much of your earnings are going to fees, but once the ball starts rolling you will earn back the listing/Etsy fees very quickly. :)
In terms of download sizes/types, 12x12 is the typical "scrapbook" paper size and many people do have special scrapbooking printers that print 12x12. Printing a 12x12 is generally pretty easy to do on a 8.5x11 standard printer, though it means some resizing/cropping/etc being done in the process. Better to have too large an image that resizes down than a too small one that is forcibly resized up. I offer all 12x12 in my store and have had only one person request 8.5x11, so generally 12x12 is the way to go. In terms of clip art, PNGs with transparent backgrounds seem to be the standard.
Regarding your overall store, my biggest tip would actually be to stop selling your jewelry and other items in it: focus entirely on digital downloads and establishing yourself on that platform alone. Unless your digital items and physical items have a very clear, unmistakable relation to one another, it's typically better business practice to separate the fields you're working in. It's far more effective to advertise and establish your store 100% in one field than try to spread it across multiple. If you want to keep selling jewelry/accessories, I would highly recommend you separate them into a different Etsy shop. Customers generally want to see that you're dedicated to doing one thing vs. trying to do a little bit of everything. They're more inclined to trust that you know what you're doing if you specialize in one area.
Your digital download listings are all set up really well. They all have the same structure to the listing thumbnails, and that is awesome. I would suggest putting more preview images in the listings, though. Also, make sure you really spell out what your terms are. Define to people what "limited commercial use" means. Looking through your policies, they're fairly confusing as you state:
"You may not copy, modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, display, or in any way exploit any of the art works in whole or in part published on this website without my (Andrea Hay) permission in writing."
...but yet you also say your digital items have "limited commercial use" licensing. You gotta be specific to someone if they're looking to buy your stuff for commercial purposes. Someone is far more inclined to skip over your product if they can't find your terms/licensing clearly spelled out.
You're off to a good start with your digital downloads. Keep uploading the things you've made, promoting in teams, and generally networking. Help other sellers out by favoriting their shops/items and they will most likely do it back to you! There are a lot of promotional teams/threads on Etsy, so join in!
Best of luck to you with your digital downloads (and jewelry)! :D
