step 1 of 4
Copy the background and desaturate. Save as a displacement map.
step 2 of 4
On a new layer start the creature creation.
Lots of masking here - then you position the parts how you want.
step 3 of 4
Select your creature and using that selection - cut out the rust texture and paste over your creature and set the mode to darken.
step 4 of 4
Then you place it back in the original background and set it to overlay and use the displacement map. I used 5 and 5 in this case.
Then you add the outer bevel and inner shadow - making sure its in overlay mode.