I can't help but wonder if language isn't the problem here. I wondered myself about the figure in mine - he isn't a person of this world, but he's also not someone else's creation. Is someone a celebrity just because his/her image is highly recognized, even if it isn't a real person?
Folks, I'll try and reiterate this again:
1. Video game characters are indeed not real people. Niether are comic book characters, graphic novel characters, animation characters, etc. However, they are the creations of real artists, ergo they are copyrighted materials. The only exception in this case is the use of the avatar outputs from The West. That artwork is ok to use.
2. A celebrity is any real, famous person or persona (like Lady Gaga) most people would immediately recognize from main stream media. Truly, by default, that type of image (which 99% of the time would be a photograph) would most likely not be attributed to a member of this forum and therefor would be a copyrighted image. However, since the rules trump the use of celebrities, you just cannot use those types of images at all. So, even if you took an original photo of Clint Eastwood, you could not use that image in the contest. I've already addressed the issue of rendering (drawing, painting, etc.) a celebrity image. You can use a celebrity image as a reference or basis of an original work, but you'd have to significantly alter the image as you render it. Otherwise, you are just copying the original image.
3. The bottom line here is simple: Use original photography. Use original art. Be creative. Have fun.
I realize the end of this contest is drawing near, but what I'm addressing here will no doubt be relevant in future contests.
Also, in the future, rules will be set in place for disqualifying participants that incur a notice or a infraction due to behavior issues, break copyright rules or commit any other offense that interferes with the decorum of a contest. I just cannot tolerate that kind of behavior at all especially in a contest thread.