I'd love to take credit for figuring out the process, but really it's just some good, old fashioned, Martha Stewart craft tricks:
http://content.photojojo.com/diy/diy-photo-transfers-on-wood/
As a side note... the color on the apricot hanger has been cleaned off and re-applied a few times cause I put it on after the fact with magic markers. Washable markers + faucets = runny colors. No biggie though.