Here is how I did this for my canoes.
1.  I took a picture of my dog standing on a chair.
2.  I scanned the picture into my computer.
3.  I erased the entire background with PhotoSuite III.
4.  I added the text with the same program.
5.  I printed out one piece of paper in color with about 6 copies of the picture on it.
6.  I took my paper copy to Staples and for about $2, had them make a color copy on plastic.
7.  I cut out one of the pictures. You can see the edge of the plastic about an inch above and parallel to her back.
8.  After I applied the sealing coat on the cedar, I put a little epoxy mixture on the back of the plastic and pressed it onto the still soft sealing coat, and painted more epoxy over the picture.
9.  After this I just continued with the normal fiberglassing routine.

    If you are going to try this, be sure you apply the picture up side down, because the canoe is up side down.  Guess how I know this?