YES YOU MUST BE ROOTED. PLEASE ALWAYS MAKE A BACK UP OF THE ORIGINAL LiveWallpapers.apk JUST IN CASE YOU NEED IT.
If this is to much for you to do go here for my Custom liveWallpapers for Ultimate Droid.
Ok first things first you will need the necessary programs to edit your images and make your files-
1. A photo editing program (i use photoshop but ive heard of gimp and others)
2. 7zip get that here
3. also i suggest WinRaR (for making your update.zips) get that here
Some of the files you will need-
1. the live wallpapers update.zip template
2. You will need the LiveWallpapers.apk specific to your ROM
Next is the files needed to customize your Live Wallpapers-
the original nexus.rs from the neural network(droid) LWP Found in your LiveWallpapers.apk
the 4 color modified one here
Ok now that thats out of the way we can start.
1. the first thing you will need to do is to get the LiveWallpapers.apk out of your /system/app/. this can be done using root explorer or any other root file manager. (you can also use adb pull but i dont know the script)
2. Once you have that onto your the ROOT of your SD Card. hook up you droid to your computer and mount it. goto to your droid and move the LiveWallpapers.apk to your Desktop.
3. Right click the LiveWallpapers.apk and goto 7zip>open archive.
4. now that your in 7zip goto res>drawable-hdpi this is the image folder within you livewallpapers. go to the image called pyramid_Back.... you can simply click and drag this to your desktop or another easy to access location.
5. now open your image editing software and change the image to what you want (but keep the Resolution/size the same). now when it comes to saving save it as the same name and as a normal .png file. once you've saved it check to make sure your withing 30 KB of the original(original file size is 325 KB)
6. go into 7zip and delete the original file and put the new on in(i do this as a security measure to make sure its in properly.)
Now to edit the Fazer colors-
1. now download the nexus.rs file above and once you have it one to your desktop open it in notepad.
2. find the strand of text that looks like this
void setColor(int c) {
if (c == 0) {
// silver
color(0.75f, 0.75f, 0.75f, 0.9f);
} else if (c == 1) {
// Blue
color(0.0f, 0.0f, 1.0f, 0.9f);
} else if (c == 2) {
// silver
color(0.75f, 0.75f, 0.75f, 0.9f);
} else if (c == 3) {
// blue
color(0.0f, 0.0f, 1.0f, 0.9f);
}
}
3. to edit this go here and find the RGB code for the color
For example if i wanted blue and silver as above, i would find blue the code is 0-0-255. divide all the numbers by 255 so you would get 0.0, 0.0, 1.0, and the last number is the amount of transparency. 1.0 being all color and 0.0 being all transparent. you must also add the color name in the corect capitulization format (Blue or Royal Blue) not (blue or royal blue)
4. lets say i wanted Orange Red the code is 255-69-0 so my strand would look like this:
void setColor(int c) {
if (c == 0) {
// silver
color(0.75f, 0.75f, 0.75f, 0.9f);
} else if (c == 1) {
// Orange Red
color(1.0f, 0.27f, 0.0f, 0.9f);
} else if (c == 2) {
// silver
color(0.75f, 0.75f, 0.75f, 0.9f);
} else if (c == 3) {
// Orange Red
color(1.0f, 0.27f, 0.0f, 0.9f);
}
}
as you can see 69 cannot be divide by 255 so i gives me a number like this 0.270588.... round to the hundredths place to get 0.27f.
you can have up to 4 different colors.
5. goto file save then exit note pad.
6. goto 7zip again and delete the original nexus.rs and put the new one in.
Now to Get the LiveWallpapers.apk to your Phone-
This can be done two ways, i suggest doing it with adb shell first then you can make your update.zip.
Adb shell Way
1.plug your phone in mount it, then move the new LiveWallpapers.apk into the root of your SD Card. then unmount.
2. shut down your phone and boot into recovery while your phone is still pluged in.
3. goto mount> and mount system and SDCard. also you must have the android SDK installed on your comuter. heres a tutorial on how to set that up. read the first one only.
4. open command prompt on your computer and type cd C:\tools or cd C:\were ever you put them hit enter. then type
then
Code:
#cd sdcard (hit enter)
#busybox cp -R LiveWallpapers.apk /system/app/ (again enter)
#exit (again enter)
5. unmount sytem then SD card and reboot your phone.
6. goto livewallpapers and see if they worked. enjoy! 
Now for the Update.zip method-
1. download the update.zip template above
2 open this in winrar and goto system>app>and replace yourlivewallpapers.apk with the modified livewallpapers.apk
3 rename to update.zip put on the root of your sd card. then reboot into recovery goto install>allow update.zip>install update.zip from sdcard.
4.reboot and enjoy!
If you like my work and want a highly custom made live wallpapers click here to donate