foreach (FileInfo source in Directory.GetFiles("png", "*.png", SearchOption.AllDirectories)
                                     .Select(n => new FileInfo(n)))
{
    string parentFolder = source.Directory.Parent.Name;
    var settings = new
    {
        Size = new Size
        {
            Width = Int32.Parse(parentFolder.Substring(0, parentFolder.IndexOf('x'))),
            Height = Int32.Parse(parentFolder.Substring(parentFolder.IndexOf('x') + 1))
        },
        Category = source.Directory.Name,
        Name = source.Name.Remove(source.Name.LastIndexOf('.'))
    };

    Image original = Image.FromFile(source.FullName);
    Image icon = new Bitmap(original, settings.Size);

    DirectoryInfo outputFolder = new DirectoryInfo(@"ico\\" + settings.Category);
    if (!outputFolder.Exists)
    {
        outputFolder.Create();
    }

    string outputFile = String.Format("{0}\\{1}.ico", outputFolder.FullName, settings.Name);
    icon.Save(outputFile, ImageFormat.Icon);
}