I think the best way to get a grasp of what can be done with graphics software is to view other artist's work. So I wanted to mention a few more digital artists that I keep in my inspiration folder (sometimes called my "why-do-I-bother" folder) All these artists use the same software but create very different work - all of it wonderful.
I said in my last post that it's rather difficult to get a watercolor effect on the computer. But Paula Becker's images are done using Painter. And her fun children's illustration have a nice airy feel to them that reminds me of watercolor washes.
Elizabeth Dulemba uses both Photoshop and Painter for her illustrations. Check out this step-by-step progression from her blog.
Carlyn Beccia uses Painter and Photoshop to create wonderfully lush images.
John Nez is primarily a traditional artist but also has a nice gallery of digital work on his website created with Photoshop and Illustrator. Go to the studio section of his site for a discussion of how he uses the computer to create his illustrations.