Back on topic, I'm interested in Ross' second question about converting files to vector graphics in illustrator. Does that happen automatically when you save it as a ".ai" file?
If you import a low resolution graphic into illustrator (or corel) and just save it as a .ai file, it does not automatically make it a vector image.
That's where the livetrace feature comes in. You have to have the software trace the low resolution bitmap and then the resulting image will be a vector image that you can save as a .ai, .eps, etc vector file.
PS. You can get white t-shirts for much less than $2.48 per t-shirt from just about any wholesale source (ssactivewear, sanmar, broder, alphashirt.com, etc)