QuiltAssistant is free design-software that can help you to turn your photos into quilts. Rather than the traditional approach of breaking up the photo into little squares ('watercolor style') it allows you to divide the photo into pieces of arbitrary size and shape.
On completing your design, you can print templates including seam allowances.
It shows pics of things it can do at the site.
Go there and see what it can do. I found this accidently. I was just asking about doing pictures here on the forum. This is realy neat and a free program. Can't beat free!
http://www.cosman.nl/software_en.html