To add a thumbnail to your recording, all you need to do is tap on the relevant button after you've stopped recording. Once you've chosen your thumbnail - either by taking a new one or choosing an existing one - you'll be taken to a crop screen.
On this screen, you will need to select a square area of your photo. Drag the area around to choose the area you want, and make the area larger by using the handle in the bottom-right.
Once you've chosen your area, tap 'Use this selection' and your thumbnail will be set!
Your thumbnail gets used in a number of places - it's used inside the list of files in Audello, it's used when you add the file to an audio bar, playlist or podcast, and it's displayed on most of the players. Make sure you pick a good one!