I've decided to post a sort of step by step thing of how I coloured my Angel & the Dragon picture. Keep in mind it's more of a "how I did it" more than a tutorial.
I started out by doing a quick sketch of the Angel on the tree in Photoshop. I do this because I find that by doing the rough stuff first I can get the pose right along with the composition and whatnot easier than by going straight into the image with colour. If I start out doing a piece with colour I tend to make things look stiff. That's just my inexperience with the medium though. Plenty of people create beautiful pieces by getting right into the colour at the beginning.
I then save the image and load up Open Canvas. I like Open Canvas for digital painitng better than photoshop because of the watercolour tool. The watercolour tool in Open Canvas really has a nice feel to it that I've grown comfortable with over the years... But anyway I set the image to multiply layer and colour the lines I have. At this stage the colouring is rough. This is because I am trying to figure what looks nice and what doesn't colourwise.
After I have everything coloured the way I want it I flatten the image so no more layers. Everything is on one layer now. I go over all the black lines with the water colour tool to give it a more painterly look. This part is tedious but rewarding :D
Now technically the piece could have been finished but I decided to add a dragon in there to make things more interesting.
After getting all that done I put it in a nice little frame and adjusted the colour balance because I felt the colours could have been stronger.
So there you go. That's how I do my thang.