This tutorial covers how to create *.col.emb files from scratch using Kensou's Tools. These files can contain any number or variety of DDS textures of any size/resolution or compression type (DXT*). The most common usage for this is to create textures that are higher resolution than the default textures, but it can be used for other purposes, as well.
Sensibeat's tutorial for making high-resolution textures is much more informative, but requires a level of comfort working with hexadecimal code and calculations. This method is considerably easier but you should still try to understand sensibeat's instructions since the same techniques are helpful in other aspects of modding.
Step 1. Open a *.col.emb file in the Asset Explorer and extract the DDS textures. Name them something simple that reflects the order they're supposed to come in (I like to use 1.dds, 2.dds, etc.).
Step 2. Open the DDS textures in a paint/editing program, such as Photoshop or GIMP, and scale them to the desired resolution. In this case, I'm scaling a bunch of 512x512 textures up to 1024x1024.
Step 3. Save the textures as new DDS files with any compression you like. This is your opportunity to change, for example, DXT1 textures into DXT5 to allow for semi-tranparency.
Step 4. Now, open the directory for Kensou's sf4tool.exe (NOT sf4toolnew.exe). If you don't have a directory named 'emb' in there, create it now, and then put your enlarged DDS textures into it. Next, run sf4tool.exe by double-clicking it.
Step 5. In the big file-directory pane on the upper-right of the window, double-click on your emb directory and click on the left-hand button underneath the big pane. The smaller pane to the left should populate with your files. Put them in the proper order by changing the filenames in the smaller pane (you can just click in there and type) and then click on the right-hand button to bundle them all together.
Step 6. Back in your 'emb' directory, you should have a new file called 'newpack.emz.' Rename it to match the col file you're trying to create, in my case GKI_01_01.col.emb.
All set! The *.col.emb file you're left with is formatted a little strangely and contains some garbage hex in the index and at the end of the file, but AE doesn't seem to care, so neither do I. :P
You can now use the Asset Explorer to extract/inject textures from your new file using the new textures as a base for mods.