Sometimes you can get surprising results just by adding a couple of layers with textures and a single pass of a filter in PS. More on how I did it after the pictures....
Original:
Final Result:
The first step was to crop the picture.
Second I duplicated the original layer, and faded the picture on the second layer by desaturaring it a little bid and moving the lightness bar to the right.
Third I added two layers of textures with 60% & 35% opacity.
Finally I selected everything around her body then went to Filter, Blur, Box Blur and selected 100%
That's it!
By the way, if you are interested in playing with textures, you can get tons of free (under creative commons license) in Flickr.