Bummer this died. Would have been fun, I love photoshop
The way it was done on another forum I participate in is that someone posts a picture with the contest in a sticky or whatnot.
Then everyone just replies with their edited version of that pic. Everyone gets one submission for that pic, not just flood 30 of them each person. Makes you think which you really want to do, etc.
It started out as a contest, but eventually turned into just something fun to do. A new pic was posted every Friday, since most people liked to do their stuff on the weekend.