Commodore 64 graphics tutorial

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It is great in Photoshop for putting all your games sprites to turn into C64 Sprites.

Excellent tutorial.
http://www.klon2.dk/tutorials/tutorial_commodore64.html

there is one things that I couldnt find is

7. Now click [Image > Mode > Indexed color]. Choose [Custom palette] and click [Load]. Locate your Color table file. Click [OK].

Choose [Dither: Diffusion 8%]. A high dither number will make the image look too perfect. Almost every images on the Commodore 64 was hand-drawn (with joystick or keyboard) and dithering nearly impossible.

I dont know where is Dither is as I using Paint Pro shop 7.