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This icon was made using Photoshop CS4 on a PC. It uses a brush made for the challenge, a bit of a stock image, layer stamping and re-sizing, a simple layer style, and a text layer.
First, I took the source pic and made a brush out of it by selecting the whole image with the marquee tool and going to Edit > Define brush preset.
I opened a new 100x100 file (72 pixels/inch in case I wanted to add text), and added a Color Fill layer as a base to work over. (Later I must have deleted the Background Layer, so you don't see that in the layers palette.) I started with whatever happened to be my foreground color at the time, but then used the colorpicker (double-click on the color square in the layers palette to open the colorpicker) and clicked around until I had something I liked. That turned out to be #222767, a dark blue.

I created a new layer, set my foreground color to white, chose the brush I just made, and clicked in the new layer to apply it. I probably clicked and then hit Control-Z to undo it a few times until I had a portion of the brush framed in a way that appealed to me (I loved the drape of the hands as much as the drape of the cloth). (ETA: I forgot that I also put a bevel-and-emboss effect on this layer! Here are the settings -- I think they're the default.)

At this point I was feeling that the ghostly light-on-dark effect I'd had in mind wasn't going to work for me, so I hit Control-Alt-Shift-E to stamp the visible layers into a new layer, and then inverted it (Control-I, or Image > Adjustments > Invert).

I liked the old-parchment look of this, but I wanted to warm it up a little, and my thoughts were turning to that yummy drapey cloth in the source brush. I wanted to bring in a silky texture to apply the brush to, and I thought it might also help my new stamped layer, color-wise. So I grabbed a lovely photo of some rucked-up red silk from CGTextures.com (under Wrinkles > Messy Folds) and copied it into my image as a new layer.

I set it on Overlay 50%, which gave me the color I wanted on the drapey-hands layer underneath it -- that image looked like a piece of tapestry now, an effect I really liked. I moved the red silk around until I was satisfied with where the light fell. Then I stamped the layers to make one layer (instead of merging them with Control-E, so that I could still change something, or copy one of the layers to use again):

Now I wanted to see how the drapey-cloth part of the source brush would look over this piece of red silk, so I duplicated the silk photo, moved the layer to the top, and set it back to Normal 100%. Then I made a new layer, set my foreground color to black, and applied the source brush to it, leaving the layer mode on Normal 100%:

This made a really pretty background -- too pretty to use as just a border or an overlay, because I'd lose all that lovely drapiness. So I duplicated the hands layer and moved it to the top, hit Control-T and then held down Shift (to constrain the proportions) while I re-sized it and moved it around, and decided that I liked it on the middle over on the right, because of the angle of the hands and the direction they draw the eye, and because that left my favorite parts of the cloth layer unobstructed. To set off the inset image a little more, I put a 1-pixel black border around it by going to Layer > Layer Style > Stroke and choosing 1 pixel, Outside, color #000000.

Then it all cried out for some text. I used the color picker to choose a beige color from the inset image (#e2cc88), created a new layer, and added the text. I went with lowercase for a more informal, relaxed effect, and the Bookman Old Style font for a bit of an old-fashioned, vintage look to match the vintagey/embroidery look of the inset hands image. Size wound up being 14 point, with no other changes to the font attributes.

And I felt it was done. Here are the layers:

Hope this makes sense and is helpful -- happy to answer questions. Thanks,
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