Yep, you got it,
the aptly named preview Image attribute

is what you need to include if you
want to preview image for your widget.

Generally, during development,
you'll be iterating on your widget, and

creating a preview
image isn't as useful.

After you've finalized your widget,
you can use the Widget Preview App,

available on Android Emulators to get
a perfect preview image of your widget.

Then put the image in your
drawable nodpi folder and

reference it in your app
widget provider info xml.