Sane is the best at smudge here, don't think you'd have enough fg to get him to bother though (not even sure if he does requests).
http://forums.d2jsp.org/img.php?i=260446&a=2- How does the smudge technique work? (in a few words understandable by a noob)
Using the smudge tool in photoshop. Basically it just drags part of the image wherever you drag your mouse, settings can be adjusted so it picks up other parts along the way, scatters, etc.
- Is it possible to combine it with other styles, i.e. a pop-out smudge sig?
Yes, although I wouldn't recommend a pop-out sig as they look crap 99.99% of the time.
- Who on this forum is famous for his smudging?
http://forums.d2jsp.org/user.php?i=260446- Since I haven't decided on the theme yet: should the render be static or have some kind of flow/movement?
Flow is always good.
- What kind of stock pictures should i supply (background, render, lights, xxxxxx?)
Just the render is usually fine. The more freedom you give the artist the better (usually).