vicpack is a command-line tool for converting regular images (PNG/GIF/TIFF/JPG) to C64 format. It exports to the most common formats like multicolor, hires, MCI, FLI and others. It can also generate runnable programs using the ACME assembler, available from http://www.esw-heim.tu-clausthal.de/~marco/smorbrod/acme/
vicpack only does lossless conversion. It is made for pixel artists who work in Photoshop (or similar), and want to know that what they see is what they get.
If you want lossy conversion to multicolor, maybe these programs will meet your needs: