Hey guys, sorry for not responding. I keep getting caught up in life's web of responsibility!
For image based displacement, you have to carefully extract or create the displacement from the image. I used photoshop to do this, and it was very time consuming. The displacement usually does NOT really match the colors/shading on the image, so its very tricky to get just right, and even then, its still not 100% accurate. Additionally, you are limited by the pixel level of the image, so up close shots usually won't work well.
In this image, I got pretty lucky. I wish I had more time to do a full write up on this, but it would be pages and pages worth of stuff.