This looks amazing and I love the retro feel to this with the colour choice and the vintage photo. I don't know if your application has layer masks, but a layer mask using a black/white gradient might help blend the edges of the photo.
It may not be quite what you had in mind, but I really like your end result. Paint Shop Pro was how I first starting messing with graphic design years and years ago. It gets the job done when it's what you have!
Oh so cool! And that photo of your grandmother is just awesome! I think you did great!