To begin on how I painted this piece, I did use Photoshop CS4... I started with this sketch...

The next step is to paint the outline over the sketch. After you load the sketch in Photoshop, create a new layer, set your paintbrush for the chalk style at about 30% opacity using black and begin to trace the lines of the sketch...

After you have completed the outline, it is time for color... create another layer for your base colors... keep the same brush style, but raise the opacity to 100% and choose your first color. Remember, that there will be highlights and shadows, so these colors will be painted on the same layer like in this picture...

The last steps in painting a piece like this is blending your base colors until you are happy with what you have. This may not be exact to my final piece, but I did this back in 2008, and I never can do the same piece exact a second time... go figure. Anyway, create a new layer above your base colors and set your brush opacity back down to about 22 - 24%... This image shows the blend of a lighter color and a darker one. I alternated from one to the other over and over until the blend starts to form... Also, I forgot to mention that your outline layer should be above every layer. Hope you get the general idea of how this paint style is accomplished. : )