Character sprites are a collection of sprites events can use. Split to a 4x4 grid, where each cell is a sprite that would be displayed in the right conditions. All the cells must be of the same size.
Rows indicate facing direction.
From top to bottom: down, left, right, up.
Columns indicate frame.
From left to right: idle, 1st step, 2nd step, 3rd step.
Events cycle through these frames as they move, looping from 3rd step back to idle, and resetting to idle when they stop.
Vanilla OneShot always has the 2nd step frame identical to the idle frame.
For example, Alula:
But you only need a complete image like that for events that move around.
Images can have unrelated sprites, such as this example featuring John Margin:
These are usually used for set pieces.