gunsight images are bitmaps in the usual powers of two dimensions format (256x256, 512x512, etc).
By default, all gunsight image files display in the game at a maximum diameter of 128mil (simply put, this is how much of the screen the gunsight occupies). So if you make a ring that's 256px in diameter, it translates to a resolution of 2px/mil in the game. If you take your 256x256 image file and make a ring on it 100px in diameter (thus, not filling up the entire image) you get a 50mil ring. You can change the maximum size at which a gunsight is displayed in the game by creating a .MIL file associated with your BMP file, which specifies the new size.