I think I have a fix for this, check here.. (2nd post): http://hydlaa.com/smf/index.php?topic=27099.0

Hey GolerGkA, bro I think I fixed this! I'll make a post in a second

*edit*

here: http://hydlaa.com/smf/index.php?topic=27099.0

[ Edit your post to add new information, please. Don't make another right after the first. --Karyuu ]

Not to be critical, I promise, but I work with Photoshop daily (i'm a pro web designer) and I promise you could make your steps easier.
But um, what version of Photoshop do you use? CS 2.3?

(1) I used the magic wand tool and a delete button to earse the back grounds on some of the photo's

The magic wand is fine, but to erase the back ground with that you'll have to use a threshold of 20-30, this is fine and removes the background but also some of the outside of your main content. A better system for this is to use the pen tool and draw a custom shape to the exact area you want, right click, then click 'make selection' and key it out appropriately.  The result looks much sharper when dealing with high res images (screenshot size).

(3) I used the smudge tool to make it so that the edges faded on some of the paintings

Smudge is fine, you could also do a diffuse glow as well as box blur inverted (be sure to highlight the opposite, select inverse, and contract as necesary)

(4) I used the cloaning tool to fill in and in some cases create whole new body parts.

Cool, but be sure to add dynamic lighting as necessary, a burn is appropriate, and never use an inner shadow, no matter how well it looks, it will always feel boxy to the user.

(5) I used an overlay to change some colors in the screenshot to make certain places darker or lighter or just to change the color peroid and not the texture. (Woo hoo for me I am learning alot for those of you who care Tongue )

You could simply add a new layer with blending style hue or color and draw over (control click the layer below to keep a safety bounding box, to not bleed everywhere).

(6) It takes time and skill to also be good at getting shots from the game to do all of this with.

True, in 3d games it's fun to try different angles too, I know you do portraits, but get some cool side shots too, use the 3d engine to your advantage.

*edit*

See with the pen tool http://img441.imageshack.us/my.php?image=gobbelsketch2zaod5.gif you can add the focus to the character, and as you see here blur out the background.

Good luck in your ventures

[ Please avoid making one post right after the other in the same thread. Just "Modify" your first post to add more information. --Karyuu ]