Thank you, Trixiebelle, for the base pic. :) Hopefully, I'm doing this right (it's too early in the morning for me to process information). First, I strongly recommend to anyone doing this kind of work to join DeviantArt.com. They have some wonderful actions, brushes, and tutorials that will teach you everything you ever wanted to know about Photoshop (or other tool) but were afraid to ask.

Actions speed up your work tremendously. When I was doing the vendors for Linda Brown's work (Luscious Latex in SL), I always took pictures in world using a certain lighting technique and background color. I had actions set up to remove the background, colorize the pictures in the exact same way, and add the standard vendor background.

The steps on this one are as follows:

1. Remove the green. Select > Color Range. Again, it's good to set up an action.
2. Green clean up. I use Filter > Liquify to clean up the green and to smooth out the weird angles caused by the Second Life avatar mesh. It may seem like a lot of trouble but it is worth it. (I can't remember where I found the tutorial but if I do find it again, I'll post a link.)
3. Next I crop and resize. I can't really tell you how I do this because all I'm doing is eyeballing it. LOL. I do try to ensure there is a good amount of space around it.
4. The background is from a texture pack I bought on Renderosity I believe. I messed with it until I got the look I wanted. Then slipped it behind our lovely model.
5. To soften the background a bit, I duplicated layer and set the layer to 40% opacity. Then did Diffuse Glow, Gaussian Blur and Brightness/Contrast until I got the combination I wanted. Preview is a good thing.
6. I then created a Gradient Adjustment Layer (bottom of the layer window , the yin yang-ish sort of symbol). Black and transparent. Radial. 150%. Ensuring black was on the outside. Once done, I put this on the top most layer, set blending mode for Color Burn 70%. I use this effect a LOT. (As you may notice. LOL)
7. A while ago, I found a great action created by Fallout75 called Vintage Film. Be sure to check the Creative Commons license on any action you download. http://fallout75.deviantart.com/art/Vintage-Film-Effect-60935227
8. To add a little depth, I selected the model, feathered the selection 20, made a new layer under the model, filled with black, and then transformed the selection to give me a shadow. I set the blending to Darken and 80%.
9. To make the border, I used a great action by `patgroove. I have an action of my own that I use. I just like his better for some reason.
http://patgroove.deviantart.com/art/Patrick-s-Pantry-2-18615817

 
Credits
Trixiebelle