As explained in section 6.8 of the mtPaint handbook, the "Convert To Indexed" tool in the Image menu is very powerful and allows many types of effect to be created on photos or other RGB images.
Here is a photograph:
I then converted this to 32 colours using a PNN quantize, and the "Dithered (effect)" option:
If you look closely, you can see that the dithering adds its own texture to all of the objects in the image, perhaps similar to fabric or canvas.
To see the above images in all their glory you will need to click them to view them at 100%.