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yeah, I too am thinking that vector is the way to go on this one too.  If you have Illustrator, you can pull the source image into one layer, and make it a Tracing layer.  Basically what that does is locks the layer and reduces the opacity so that you can go over it by hand with the Pen tool ti define your blocks of colour.

The method that Mark showed was really cool too, but taht will, as you saw, procude results that are much ... smoother than what it seems you're looking for.

This is something that I imagine would be much easier done with a graphics tablet  %}    But FWIW, that's my advice to ya.

Anam