Hi Justin,
A few quick answers.
- Dynamic packaging does not generate thumbnails on the fly at all. The default presets for Content Aware, Adaptive Bitrate, etc, do generate a "best" thumbnail, but if you want to control the thumbnail settings you do need to add that to a custom encoding job. I have some Javascript/TS samples here that show how to do that:
https://github.com/Azure-Samples/media-services-v3-node-tutorials/blob/b0ad91bb7f0b466fb6ec1237301ff7c6e130c49b/VideoEncoding/Encoding_H264/index.ts#L115 - You can send any existing Asset in AMS back through a "thumbnail" specific transform. See example above on how to create a thumbnail in a preset. Just create a preset that does nothing other than generate a single JPG, or a Sprite with VTT file as in this sample. Just remove the video and audio tracks from that Transform - https://github.com/Azure-Samples/media-services-v3-node-tutorials/blob/main/VideoEncoding/Encoding_Sprite_Thumbnail/index.ts
- All the schema for this is actually in the REST API. You should look at the Transform entity details in the REST API for all the encoding and thumbnail settings. Search for PNGFormat, JPGFormat, JPGImage, PNGImage, - https://learn.microsoft.com/en-us/rest/api/media/transforms/create-or-update
- Correct the JPG or PNGImage objects in the REST API have all the settings you would need.
Hope this helps!