In the AssetJam you don't make a game, so you are at the right place.
Yes, if you draw a bunch of game items that would fit right in.
Size and resolution is not terribly important. However the sizes are normally in exponents of two. (So normally starting at 8x8, 16x16, 32x32, 64x64, 128x128, etc. always doubling in regards to the previous size.)
Choose on size and draw all your items in that size. (Or in multiples of your shosen size. So if you for example make the sprites in the size of 16x16 and you have a larger item, maybe a big enemy or sword it could be in 16x32, which are two 16x16 spaces. A larger rock might be 32x32, taking up four 16x16 spaces.)
Lastly sprite sheets are normally one image (in .png format) containing all sprites aligned to a grid in the chosen size.
I hope all that is understandable. If you have additional questions don't hesitate to ask.