I found this awesome opensource image to ASCII converter from lifthacker blog. This project is hosted in SourceForge <link> and is completely written in C#. This project is released under GPL license and you can download the executable and sourcecode from SourceForge with free of charges. Here is the technique used in this tool.
The image above is generated by uisng Ascgen2. If you want to take a look the generated HTML version, you can check this link. (Demo : http://michaelsync.net/demo/ASCII-tifa.html )
Credit : I got Tifa Lockhart’s photo from Google Image Search. Full credits go to the original creator.
BTW, this girl is animated but I think she is hot. Wat ya say?