Outstanding image - and I have seen tons of these. At first, I was thinking I would have liked to see at least some detail in those dark areas. But on secon thought....well...not sure. Superb color. Good detail in the highlights.

Well, there is a slight difference. Canon lenses tend a bit toward the warmer and Nikon tend toward a somewhat cooler image. Neither is "correct." Shooting in the same color space or converting to it will not fix this. On the other hand, the difference is not huge and if I were to hire a second shooter, I would be far more concerned with his or her skill level, personality, and work ethic, than what camera system was in use. Small color differences is a temporary issue - but incompetence or a jerk can sure mess up a client.

If you shot RAW, the noise reduction feature in CS5 is quite remarkable. There are also some very good noise reduction plugins: Noise Ninja, NIK Define, Noiseware Professional, probably a few more.

I the book is available digitally, it would seem FAR less work to buy an iPad, Kindle, or similar device, and just download the darn thing! What you are proposing can work, but it will require a LOT of time.

Buy this book: "Light, Science, and Magic" by Biver and Fuqua.
Best book on how to light difficult subjects you will ever read. Should be in every serious photographer's library.

http://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Dstripbooks&field-keywords=Light%2C+science+and+magic&x=0&y=0

Couple of tips: Shoot at f8 at a minimum - f11 is better. You can shoot at 2.8 if you are shooting ONE person and want to emphasize a shallow DOF, but for groups, you need to be sure everyone is sharp. Focus on the eyes-if the eyes are not sharp, it is a failure.
In the shot of the couple it looks like the camera is too low - they are looking down their noses at you.
Fort the lights, try this: place one directly over the camera, place the other about 45 degrees or so off to one side. Make sure both are high. The one off to the side is your main light - the nose shadow from that light MUST fall down at an angle. The one over the camera is your fill. It MUST NOT create any shadow. Metering from the subject, the main should be at least one stop greater than the fill - a bit more might be OK. Meter them independently so one does not contaminate the other. Don't have a flash meter? Buy one. If you are going to do this, you have to meter accurately.
So set the main so it meters f8 or f11 and set the fill to meter one stop under. This will give your subjects dimension - you need shadows to define the face -your lighting is way too flat (no dimension/no shadow).
What I described will give you a classic lighting setup. Obviously, one can deviate from it and get great stuff,but it is good to know a starting point from which to deviate.

I realize the only flash you have is the pop-up, but I have to critique what I see and the pop up flash is a quality killer. It is harsh/hard and flat. The advice from pheintz is good. Get an SB-700 or SB-910 for Nikon - Ex430/580 for Canon and aim it at a wall and bounce the light back onto your subject. For a portrait, under no circumstances should you aim the flash at the subject if the flash is the main light. If outside and the flash is used as a fill, that is different. The Kleenex fix is OK, but hardly a long-term solution.

I use a D2x, D3, and D7000. The image quality on the D7000 is as good as the D3 at ISO below 1600. The D3 is $4000.00 more!
Sure, the D3 has other great features that make it a true pro tool, but that D7000 is one of the great bargains in photography. Buy it!

IMO, having a CD as your deliverable is a horrible idea. I have had a few folks ask for a CD, but after I explain what that would cost them, they either agree it is not such a good idea, or they go elsewhere. If they REALLY want the CD, the images are going to be about $150.00 EACH. Those images would be fully retouched and the client given explicit instructions on the types of labs that will print them properly. I also would not give them my usual money-back guarantee since I have no control over the final print.

There is one possibility that would be a legitimate concern of the professionals.
I shoot swim meets and one venue requires a $125.00 fee, proof of a sales tax license, and proof of liability insurance. I am the only photographer allowed to shoot images for sale. Anybody else is free to shoot for their kids, but may not sell images.
If though there was someone else shooting with the intent to sell, I would certainly check it out. (I would have the event staff check it.) If it turned out they were, I would make sure they were escorted off the site.
I would have no problem turning them in to the state for non-payment of sales tax. Why should some of us follow the rules, only to be undercut by those who do not.
I have no issue with amateurs shooting for their own family. I have made some great friendships with moms and dads who take photos of their kids at these meets and have helped them make better images. Several have given up even trying to get the images I can get and just buy from me!

For minors, I agree. For adults, since the image is not being used for commercial purposes, I do not think it is necessary. A good idea....probably.
I do mostly portrait work and at every session I need a signature on two bits of paper - a check and a model release. And the release is not just internet use - it is for ANY future use. You never know how you might want to use a image in the future.

I know the argument for not using them. However I recently had the $88.00 B+W UV filter save a lens that costs $1800.00. Threw away a scratched filter and bought a new one.
I used to work at Wolf Camera and I know they push $20.00-$30.00 low quality filters. Might as well put a coke bottle bottom on your lens - the good stuff from B+W will not make a noticeable degradation in your image. Most customers were incredulous that a good filter cost as much as their kit lens (or more!).

If you want it to LOOK like a watercolor picture, you need to make the image look like a watercolor image - just printing on a specific paper won't do it. Epson makes a "Watercolor" paper, but it is a heavy matte paper that makes a watercolor-like image look good. It does not magically transform a standard image into something resembling watercolor.

I don't know what psp is. I do think most hobbyists would be well-served by Lightroom and Photoshop Elements. Photoshop is almost $700.00 and if Adobe stays with their pricing plan , you will HAVE to upgrade every 18 months (or so) if you want to stay current - no skipping upgrades.
Photoshop can take a few years and lots of practice to become reasonably proficient. Much of it is for graphic designers and of no use to us.
Lightroom does a great job for most folks for less money and is far easier to learn.

With very few exceptions, non-manufacturer inks have one purpose - to separate you from your money.