That's a good question. To be honest I never read the 'full' license, just the parts I thought I needed
(i.e. "on–line or electronic publications, including web pages to a maximum of 800 x 600 pixels"). I have no idea as to why they would place a maximum on the screen resolution.
In your particular situation, eg: selling templates, I would be quite sure that you are not permitted to use iStock images in templates you are selling on your website...
You May not... "use the Content in design template applications intended for resale, whether on-line or not, including, without limitation, website templates, Flash templates, business card templates, electronic greeting card templates, and brochure design templates;..."
It's interesting to note also that you
may not "install and use the Content in more than one location at a time". I take it this means that if I download a photo for use on a company's website and then decide to use it in their printed brochure then I need to purchase the image again?