The poster was right on the money in terms of first placing each image on a layer in the position you want it. Here is an example of one I did and sold. (continued - scroll down)

http://www.pbase.com/santa/image/34470929.jpg

In teaching Photoshop I have learned it can be a great help to see an associated layer palette so here it is:

http://www.pbase.com/santa/image/34470928.jpg

Open each in a separate window. Starting at Layer 1 we have the foundation layer. In some instances you might want that to be a solid color, or another image entirely. Here, we start with the first layer, Layer 1 upon which we place another image above in the upper left corner. The mask on the right shows the right edge and bottom edge feathered. Note the white rectangle in the upper left section of the mask on Layer 2. That shows us what will be opaque - what will cover up Layer 1. The black area is what will be invisible. You can paint in grey to allow some percent of opacity. The little black triangle on the bottom of the white block in the mask is there to let the head of the musher in the layer below, come through. The two snow areas on the originals were carefully color balanced as best I could, before layering the pictures so one snow scene would flow into another.
Layer 2 Copy is there only to brighten the face of the musher in layer 2. It is set to Screen, to brighten his face, which was in deep shadow on the original exposure.
Layer 5776 brings in a closeup of the musher ( I had taken all these photos in the last day or two, during a mushing contest) and it masks out everything but the musher to allow the previous sky to be the backdrop.
There you have it. The anatomy of a collage.
You'll see some of my early attempts as well as some of my better collages at
http://www.pbase.com/santa/collages and here is one of my favorites that sold several 13x19 copies so far. The web version doesn't do justice to the tack-sharp quality of almost every shot. The Canon 70-200 IS on a monopod was used for every one of these shots and it nails the focus on AI Servo so effectively. Just couldn't be happier with it. Sorry about the proof mark running diagonally through it. http://www.pbase.com/santa/image/27478674.jpg