If your scanner can save to RAW do that, otherwise save to TIFF as that's more compatible with most sofware on Windows and Mac. It's also lossless so it will preserve more of the original detail.
The DPI determines the physical size of the image. If you want to print the final image, use a DPI around 300 as that's compatible with most printers. You'd only use a higher DPI if you're planning on enlarging the picture later. I'm guessing the original picture is probably 6x4 inches. To give you an idea, scanning at 300 DPI will give you an image that's 1800x1200 pixels when you import it into Photoshop. At 1200 DPI, it will be 7200x4800 pixels which is way too big - with a 300 DPI printer, that equates to 24x16 inches in size! And most of the additional info will be discarded by the printer/Photoshop when you scale it back down to the original 6x4 inch print size.
If you just want an image for use on the web, use a DPI of 100. Again, a 6x4 inch image will produce a 600 x 400 pixel, or lifesize, image which will be fine.
If you can control the bit-depth, use the highest value. This is more important than the DPI as it determines the number of bits used per pixel, and therefore the depth of colour that can be retrieved from the scan.
You should be able to get a smaller filesize - I suspect the 800 DPI has bumped it up significantly. Again a comparison - a 6x4 inch print at 300 DPI gives you an 1800x1200 image size or just over 2 million pixels in that file or 6.4Mb colour filesize. The same image at 1200 DPI = a 7200x4800 pixel image or more than 34 million pixels - a whopping 103.6Mb file. In simple terms, each time you double the DPI resolution, you multiply the pixels (and therefore the filesize) by a factor of 4.
Another cause of excessive filesize is if you scanned the entire surface of the scanner bed, and then cut out the portion that contains the picture before posting it here. There's usually an option with your scanning software to preview first - this scans the entire bed - and then you can use the mouse to draw a marque around that portion you want to keep. The scanner will then do another pass at the higher resolutions you've dictated but the filesize will be consequently smaller. With 300DPI and a 6x4 print, a TIFF file should be around 6-7Mb or so.
Other tips:
- Clean the photo first by using a lens blower to get rid of any dust. Do the same with the scanner. Far easier to remove the dust first than to record it in the scan and labouriously remove it afterwards.
- Always scan in colour, even black and white images.
- Don't bother trying to set the picture straight in the scanner - use Photoshop's Ruler tool and Image Rotation to straighten it up later. It's usually best to leave a slight margin around the picture when you scan as it makes it easier to draw the marque for the final version.
- As mentioned above - regardless of what "resolution" your printer manufacturer claims to be, stick to a scanned DPI of 300. Otherwise use 100DPI for the web.
- It's usually best to ignore any scaling options with your scanner software. If you want to scale, do it later in Photoshop.
- Similarly ignore any other options such as interpolation
If you need further help, just ask - I've only just finished scanning and fixing over 100 old photo's for a genealogy project so I'm pretty familiar with the techniques now.
Summarising your basic scan settings:
- Save to TIFF
- Scan at a resolution for the intended output (300 DPI print or 100DPI screen)
- Scaling 100%
- Descreening No
- Interpolation No
- Scan to Colour or RGB