Of course not, it's just math. What you do need is sufficient memory to do the math, which often becomes the limiting factor. The difference is that doing 8x8 pixel images is FAR easier than doing 512x512 images. And since we're doing math, there are approximately:
1.158 X 10^77 unique 16-color 8x8 images you can theoretically generate on a C-64. Or if you prefer the exact number:
115,792,089,237,316,195,423,570,985,008,687,907,853,269,984,665,640,564,039,457,584,007,913,129,639,936
So, how many unique 512x512 24-bit color images are there? Oh, not too many, just...
9.384 X 10^3044820
Here's the full number, which is a bit like calculating Pi to three million digits. LOL