The parameters dialog box you allow to use your image files to draw the textures and create deformation.
You can also use an other method for apply deformations to your images. Read this new tutorial.

In the ToolPalette, click the category of texture you are interested in, then click one of the texture icons to the right.

Now, click the Parameters button on the ToolPalette.

In the Parameters dialog box, click on Adjustement tab and to Clear Buffer.

In the Parameters dialog box, click on General tab and to Load gradient from file. Now, select the image file that you want to use to draw the texture.

After the image file is loaded, click to Generate button. You can also save this texture setting in the ToolPalette for future use by clicking the Add button.

Your texture setting is saved in the ToolPalette.