Create your icon using your image editing program of choice. The icon should be 512px X 512px. This size allows for the icon to be used on Retina display devices and will automatically scale down for use on older iPhones with lower resolution screens. You do not need to round the corners of the icon; iOS automatically rounds the corners and gives it a button-like appearance.
Save the icon as a PNG in the root directory of your website using the filename apple-touch-icon.png. iOS will take it from there!