In order of lesser evils:
1. you get redrawing, which is simply redrawing while looking at a source image.
2. then you get tracing, which is just drawing over the source image, but not using the actual source image in the final piece.
3. then you get CP, which is putting the image, or elements of the image, onto the texture and mostly calling it finished.
all 3 ways are fine, if used correctly, so long as the original artist is credited.
if the original artist is not credited, then it may be used, but not sold.
making profit off someone elses work is where we draw the line and call plagiarism.