We've just released the source code for our CSS sprite generation tool on Launchpad. It's covered by a BSD license which allows both personal and commercial use. If you've got Bazaar installed you can checkout the remote branch. Alternatively you can download a tzr.gz of the files from the same location.
bzr branch lp:css-sprite-generator from the command line.
Our first tool is a CSS Sprite Generator. Upload a ZIP file containing individual images and it will return a combined image and all the CSS background-position rules required to display each component image. It accepts and can generate PNG, GIF and JPEGs and provides a range of options allowing you to tailor the output image and CSS to your site. We hope you find it useful and please contact us if you've got ideas about how to improve it.
Stu loves hacking on webapps with Python. If all else fails Stu could always get a job as a barista.