Almost any photo editing software can scale images. There are shareware ones like gimp that another poster mentioned, or reasonably priced commercial ones. CAD programs also do even better at resizing, but are sometimes a bit difficult to import your own graphics into. But they are great for doing original art. And there are cheap CAD programs available at bargain software counters. A very good photo editing program is Adobe Photoshop Elements, but there are a number of cheaper ones available. I think there is even a graphics program that comes in Windows that will do the job.
The big hangup is whether the decal needs white or other really light colors in it. If dark colors only, homemade decals are a cinch. Ones with white or light colors are a real hassle.
For the resizing, you will need to do some simple math to figure out what percentage to resize, but pocket calculators are cheap these days.
As for the flag, don't use a decal for it. Just download a flag graphic from the internet, resize, copy it and do a mirror (flip) to make a copy facing in the other direction. Put ot next to the original. Cut out and fold on the common edge, and put a piece of thread through the fold. Glue together the folded flag with thinned white glue, and put some wrinkles in it while the white glue is drying. Your result is a flag on a halyard.