How to use matlab to convert a picture to 8 colors (for Threadless.com)

A friend of mine wanted to make a t-shirt design for threadless. But one of the recommendations is that the picture only have 8 colors. It wasn't obvious to us how to do that in a photo editing program, so I tried it in matlab, which turned out to be quite easy if you have the image processing toolbox (for the rgb2ind function).

RGB = imread(filename); % read RGB image file
[IND,map]=rgb2ind(RGB,8,'nodither'); % convert to 8 colors

imwrite(IND,map,filename2); % save new reduced color image file

I tried it with and without the 'nodither' option. Most pictures I tried looked better with the dither. See one example below:

original picture with more than 8 colors

8 colors - dither

8 colors - no dither