Honestly, I'm not sure that you will be able to And the reason I say that is that there is a size limit to our books. 20MB. Now I'm not sure how big your picture book is, but if it's over that, it will not upload. Not to mention a pdf uploaded doesn't convert well at all. At least no one that's ever tried has ever come in here and said they had any sort of success with it. But who knows, maybe yours will as long as your file isn't too big. If that doesn't work, then I'd try to convert your pdf to epub first then see how large your file is before uploading.
the InDesign software sounds like it might be useful for you. Granted, I haven't used it and I don't know exactly how it would work for this kind of thing, but overall it's very good for eBook formatting. You can buy it flat out or they have a subscription model for month to month use, too.
If you want to see how it goes, you could also try converting pdf to epub using Calibre. That option is free, but I couldn't tell you how it'll turn out. I don't think it'd be too difficult/bad, but when you add pictures to eBooks it can get a lot more difficult/trickier than otherwise.
My company publishes educational comic books, and have converted our print titles to ePub. For a nominal fee, we'd be willing to assist you. If you are interested or would like more information, please let me know.
Two rules of thumb for getting picture books to work right as EPUBs are it should be longer than it is wide, landscape format doesn't work out for everyone who would want to read your book. Secondly the text that's imbedded in the images must be large enough to read on the smaller devices. If you have 12pt text in the images and put that in an epub it's going to be nearly impossible to read right on the smaller devices. On a PC/Mac it will likely be fine but you'll anger all the Nook owners that buy it, and rightfully so.
As for file size, with 32 pages you should be able to keep it under 20 megs easily enough but be aware of how big each page is being saved as so you don't have to go back through it and adjust them over and over again.
I have a picture book in psd files. Does anyone know how I upload them into pubit? for a Nook book. Do I change to jpg? and if so, what size works best? I'd really appreciate some advice.