(See the best response by Nadrew.)
Okay, so my icons for this game are 32x32 and I have a (non tile based) free movement style game. I want to make this guy swing a weapon and have it hit anything it Bump()'s for instance.

I've looked over the overlays but they can't be accessed directly. I have checked out using an image but they are only for visual and I have considered just spawning a new icon obj on the screen and animating it but anytime I use the new command and referring a location it goes directly to a tile and doesn't take in account that I have an offset. Is there a better way to do this? Or a way to mimic the tile offset so I can get this thing to look like it attacks from the character?

(general example of game atmosphere)

Best response
You'd probably be better off keeping the swing itself a visual-only thing, and just calculate out the arc of the swing and handle the damage stuff based on that.

Or you could manually update the bounds variable of an actual object based on said calculated swing and use Cross() to check things, but in general, relying on a moving bounding box like that can lead to some funky results.
Gotcha, thank you for your response. Would you recommend an animated image or say 3x3 image that could simply have the swing movie icon drawn for each direction the character could face without animating?
That's really a developer/artist preference, whichever gives you the desired result, visual-only things are nice that way.
In old NES games with graphics of the quality above, they usually just flashed an icon state of the attack and used a fixed bound to check for damage.