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As it's Halloween, it is only appropriate for me to do something scary and what can be any more scary than a guide on how to digitalize artwork, in case one is good at drawing, but not the greatest at bringing it to the computer screen?

Before I begin, you have to know that this isn't purely original, the original idea and part of the text come from the SFGHQ (Sonic Fan Game Head Quarters) Forums, where all hell has broken loose, but since this guide I wrote (in response to someone asking that very same question) isn't half bad, I'd like to preserve it here, for future generations to not care about. RKD, the original poster of the question and owner of the sketch, commented on this picture and said it was fine for me to use this picture and fine for you to use it, what you'd use it for, that is up to you.
Now, I don't actually use this process myself, but I do know how (approximate, that is) the desired effect can be achieved, so I tried my best and made this and will explain how I did it so that you might be able to do that yourself.

First you have to have an image-editing program, just about anything goes, but for the purposes of this guide, it was written with Paint.NET in mind (since I use it, the recipient now uses AESprite), but anything fairly advanced, may it be PhotoShop, GIMP or anything similar, should do the job.
You should start with something you want to digitalize, in this case, it's a sketch of a badnik, to be used in a Sonic fangame, made with graph paper and a pencil, though anything can work, scanned with a scanner. If needed and possible (though, not necessary), clean the scanned artwork, such as removing the graph paper lines and fiddling with the contrast, but it's up to you. Also, you need to know what target resolution you're going for, in this case 32*24 was targeted (though, excluding the border, the image has a resolution of 28*19).
Step 1 would be cutting out the image properly, if needed, here, for example, originally the image was larger than the box he drew himself in. Now, if you were to rescale it right now, you'd have a mess of greys in the loose shape of the image, as opposed to a colourable sprite, so, in order to avoid that, the Step 2 is to colour the sketch in digitally, it doesn't have to be a masterpiece, as you can see, but the shapes should be visible (so, should you want to use similar colours, use temp. colours first, which won't blend together easily), also, the word layers should come to mind, since then you don't need to overdraw the image directly, making the whole mess easier. AESprite and maybe some other programs, by the way, have a function called "Reference Layer", which, independent of the resolution you work at, shows a picture behind the background layer to use as, well, reference. You can, as I did, colour the background in with pink (or any non-used background colour), to make things easier for you later.
Once you've done that, it's time for Step 3. You can now rescale the image down to the desired resolution, I personally use "Highest Quality" rescale myself (in which case Paint.NET decides which resampling filter to use, in this case it's Fant's), but other filters may have other effects, you can mess about with that (also, from now on, the images will be scaled up to 10 times their size so you can see what I'm doing). As you can see, it still looks like a mess, just as it would've if you'd have rescaled it from the start. However, since the shapes are all different colours, you can now actually see what shape is what, instead of it all being a grey mess in the loose shape.
Now, for Step 4, using the colours you used, redraw this shape into a smaller scale image with limited colour palette, since it all has been smoothened out (except if you'd have used "Nearest Neighbour" resampling), you have to let your judgement decide which colour to use for each intermediate pixel.
Once that's done, for Step 5, you merely have to (re-)shade it, if you want/need it (I didn't do that since I suck at it), and you'd be good to go, a fairly decent approximation of a smaller scale version of the original sketch. Easy, wasn't it? (inb4 "No, it wasn't...")

So, what do you think, of both the quality and the contents of this guide, is it good, is it bad, I need some feedback for possible future guides? If you use this guide, you don't need to credit me, it would be nice, but just for teaching you how to do it, it's not necessary. You do need to credit RKD though should you use the image, even if I made everyone but the first.
Feel free to post your works in the comments below though, wouldn't mind seeing what you can make with this newly aquired powers.

~MrLevRocks