At this point I just finished up the rest of the head. I did a lot of touch-ups on the ears, since they weren't lining up perfectly with the model, and defined the hair better. I also went in with a ligher color of the hair and added highlights.

Since the plan is to make poly hair later, all that I really care about is if the hair edges look correct, but its still good to get it all looking as good as possible.

The last thing I do to any texture for low-res real-time is apply sharpen to it. Flatten the image and go Filter > Sharpen > Sharpen. Then go to File Save As.. and save your texture as a .tga or whatever format you want to use for the final texture.

When you go back into max, edit the material for the head (click on the box next to diffuse and change it from the psd to the new flattened image you just saved).

Comparring the end result now with the way the head looked before I started any manual touch-ups really makes it obvious how big a difference it can make.

Onto the Clothing

I do clothing differently then I do faces. I lay down a base texture and it's usually extreamly plane and flat. I'm not looking to get any shades or wrinkles in the base texture. Just the actual 'texture' of the fabric, and maybe things like seams, pockets, zippers, etc.